Short-term securities are safe to keep idle cash balance.Choose from the following, one appropriate reason for this.

Question

Quizplus · Accepted Answer

Short-term securities typically have lower interest rate risk compared to longer-term securities, making them a safer option for idle cash balances. While they may not offer high returns or high net present value, they are a convenient choice for receiving interest payments.

Short-Term Securities Are Safe to Keep Idle Cash Balance