Liquidity is a measure of the ability of a business to meet both short-term and long-term obligations.

Question

Quizplus · Accepted Answer

Liquidity refers to the ability of a business to meet its financial obligations as they become due. This includes both short-term obligations like payment of bills and loans as well as long-term obligations like payment of dividends and interest on bonds. It is an important measure of a company's financial health and ability to operate successfully.

Liquidity Is a Measure of the Ability of a Business