Answer (D) is correct . Liquidity is a firm’s ability to pay its short-term obligations as they come due. Trade payables are the most common form of short-term obligation. Thus, a credit manager is most interested in assessing a potential customer’s liquidity.
Answer (A) is incorrect because Equity investors are concerned with profitability ratios.
Answer (B) is incorrect because Equity investors are concerned with valuation ratios.
Answer (C) is incorrect because Equity investors are concerned with growth ratios.
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