Liquidity represents the degree to which a firm has cash available to meet maturing debt obligations.

Question

Quizplus · Accepted Answer

Liquidity refers to a company's ability to meet its financial obligations with readily available cash or assets that can be quickly converted to cash. Therefore, it represents the degree to which a firm has cash or assets that can be easily turned into cash available to meet maturing debt obligations.

Liquidity Represents the Degree to Which a Firm Has Cash