The most precise test of liquidity isa.Absolute Liquid ratiob.Current ratioc.Quick ratiod.None of the above

The most precise test of liquidity is a. Absolute Liquid ratio.

Here's why:

1. The Current Ratio: This is a financial metric that indicates a company's ability to pay off its short-term liabilities with its short-term assets. While it does provide a snapshot of financial health, it is not as precise because it includes inventory, which may not be as easily converted into cash.

2. The Quick Ratio: Also known as the acid-test ratio, this is a more stringent measure of liquidity than the current ratio. It excludes inventory from current assets because inventory may not be easily converted into cash. However, it still includes other current assets that may not be as liquid.

3. The Absolute Liquid Ratio: This is the most precise test of liquidity. It only considers the most liquid assets of a company, i.e., cash and cash equivalents. These are assets that can be converted into cash immediately, providing the most accurate measure of a company's short-term liquidity.

Therefore, the Absolute Liquid Ratio is the most precise test of liquidity.