The risk of illiquidity is increased if either cash and marketable securities are decreased,or if the firm relies more heavily of long-term debt.

Question

Quizplus · Accepted Answer

The risk of illiquidity increases if cash and marketable securities decrease, but relying more on long-term debt does not directly increase illiquidity risk; it affects leverage and financial flexibility instead.

The Risk of Illiquidity Is Increased If Either Cash and Marketable