Question

ratios that measure a companys ability to pay off short-term debt are ______.

• leverage ratios
• asset management ratios
• liquidity ratios
• market ratios

Explanation:

To determine the correct ratio type:

• Leverage ratios measure long - term debt - related risk.
• Asset management ratios assess how efficiently a company uses its assets.
• Liquidity ratios specifically evaluate a company's ability to meet short - term debt obligations (like current ratio, quick ratio).
• Market ratios relate to a company's market value (e.g., price - to - earnings ratio).

So the ratio measuring short - term debt - paying ability is liquidity ratios.

Answer:

C. liquidity ratios