Which of the following is a common liquidity ratio?

The current ratio is a common liquidity ratio because it measures a company's ability to pay off its short-term liabilities with its short-term assets. This ratio is calculated by dividing current assets by current liabilities, providing insight into the financial health of a business in the short term. A higher current ratio indicates that a company has more current assets relative to its current obligations, suggesting better liquidity and financial stability for meeting short-term debts.

In contrast, the debt to equity ratio assesses a company’s financial leverage and indicates the proportion of equity and debt used to finance the company’s assets. Earnings per share (EPS) is a profitability metric that indicates how much money a company makes for each share of its stock, focusing on profitability rather than liquidity. Return on investment (ROI) is a measure of the profitability of an investment relative to its cost and also does not directly assess liquidity. Therefore, the current ratio is distinct as it specifically serves the purpose of evaluating liquidity, making it the correct answer.