Liquidity ratios include current ratio, quick ratio, etc. Study the quick ratio definition, discover how to interpret the formula, and work through quick ratio examples.

The liability to equity ratio measures the gearing risk or leverage of the company. It measure the degree to which a company is financing its operations with debt. Liquidity ratios show the short-term liquidity position of the company. A liquidity position means the ability of the company to pay short-term debts.