current ratio

noun

1. A financial measure of a company's ability to pay its short-term debts, calculated by dividing current assets by current liabilities.

   B2

   countable; usually singularfinance

   • "The company has a current ratio of 2, so its current assets are twice its current liabilities."B2
   • "A current ratio below 1 can suggest liquidity problems."B2
   • "Analysts compared the firm's current ratio with the industry average to assess short-term financial health."C1