In making short-term investments,firms consider:
A)creditworthiness of the company and the interest rate.
B)maturity,liquidity,risk,and flexibility.
C)broker's recommendation and competing opportunities.
D)opportunity costs and flexibility.

Question

Quizplus · Accepted Answer

When making short-term investments, firms consider various factors to ensure that they can access their funds easily when needed. The factors include maturity, which refers to the time frame within which the investment earns interest or benefits; liquidity, which relates to the ease with which the investment can be converted to cash; risk, which involves the possibility of losing part or all of the investment; and flexibility, which denotes the ability to shift funds from one investment to another to maximize returns. Therefore, firms should consider these four factors when making short-term investments.

In Making Short-Term Investments,firms Consider