Problem:

Wendy Wilson, a successful college graduate, is currently employed in a position paying $49,500 a year. Wendy's annual living expenses are only $42,000 so she has accumulated $7,200 in monetary assets and $27,000 in investment assets since her graduation.

Required:

Question: Use the liquidity ratio to figure how long Wendy could pay expenses if she were to lose her job? Explain in detail.