Which of the following ratios best measures a company’s ability to meet its short‑term obligations without raising new external capital?

Step-by-step solution

1. Identify the definition of quick ratio: $\text{Quick Ratio}=\frac{\text{Cash}+\text{Marketable Securities}+\text{Accounts Receivable}}{\text{Current Liabilities}}$.
2. Explain that quick ratio excludes inventory, which may not be quickly liquidated.
3. Conclude that quick ratio therefore measures ability to meet short‑term obligations without external capital.

Concept tested: Liquidity ratios

Published 10 October 2026 · How this solution was prepared and checked