Investing heavily in short- term investments rather than in fixed assets tends to make a firm:

Question

Quizplus · Accepted Answer

Investing heavily in short-term investments rather than in fixed assets increases a firm's liquidity because short-term investments can be quickly converted into cash. However, this strategy may result in lower profitability since fixed assets, such as property, plant, and equipment, often generate higher returns over the long term.

Investing Heavily in Short- Term Investments Rather Than in Fixed