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Finance Dictionary and Glossary of Investment Terms
Current ratio
Definition 1.
Indicator of short-term debt-paying ability. Determined by dividing current assets by current liabilities. The higher the ratio, the more liquid the company.
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Definition 2.
Indicator of company's ability to pay short-term obligations; calculated by dividing current assets by current liabilities.
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Definition 3.
Current assets divided by current liabilities. An indication of a company's ability to meet short-term debt obligations; the higher the ratio, the more liquid the company is.
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