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Finance Dictionary and Glossary of Investment Terms
Cash ratio
Definition 1.
The proportion of a firm's assets held as cash.
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Definition 2.
Total dollar value of cash and marketable securities divided by current liabilities. For a bank this is the cash held by the bank as a proportion of deposits in the bank. The cash ratio measures the extent to which a corporation or other entity can quickly liquidate assets and cover short-term liabilities, and therefore is of interest to short-term creditors. also called liquidity ratio or cash asset ratio.
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