The risk of a firm not being able to pay its bills on time is called
A) illiquidity.
B) insolvency.
C) capital inadequacy.
D) float.

Name: The risk of a firm not being able to pay its bills on time is called A) illiquidity. B) insolvency. C) capital inadequacy. D) float.
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Question

Quizplus · Accepted Answer

Illiquidity refers to the inability of a firm to convert assets into cash quickly without significant loss in value, which directly impacts its ability to meet short-term obligations, including paying bills on time.

The Risk of a Firm Not Being Able to Pay