Financial stability refers to the ability of an entity to:

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Financial stability refers to an entity's ability to meet its long-term obligations. This means that the entity has a steady cash flow and enough resources to cover its debts and financial commitments. While earning a high rate of profit and reducing expenses can contribute to financial stability, they are not definitive indicators of it. Increasing market share can lead to profitability but does not necessarily guarantee financial stability.

Financial Stability Refers to the Ability of an Entity To