If a firm wishes to invest cash that might be needed at short notice in the very near future, they would be most likely to invest in which of the following securities?
A) Treasury bills
B) certificates of deposit
C) repurchase agreements
D) banker's acceptances

Question

Quizplus · Accepted Answer

Treasury bills are short-term debt securities issued by the government with a maturity of less than a year. They are considered to be one of the safest investments with essentially no credit risk. Treasury bills can be easily bought and sold on the secondary market, providing liquidity to the investor. Therefore, if a firm wishes to invest cash that might be needed at short notice in the very near future, investing in Treasury bills would be the best choice.

If a Firm Wishes to Invest Cash That Might Be