Because inventory is not a liquid asset, cash invested there is tied up and cannot be used for other purposes.

Name: Because inventory is not a liquid asset, cash invested there is tied up and cannot be used for other purposes.
Brand: Quizplus
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Question

Quizplus · Accepted Answer

Inventory is considered a non-liquid asset as it cannot be easily converted into cash, therefore any money invested in inventory is unavailable for other purposes until the inventory is sold.

Because Inventory Is Not a Liquid Asset, Cash Invested There