The Principle of "Matched Maturities" in Finance Refers To

question 121

Multiple Choice

The principle of "matched maturities" in finance refers to:

• A)finding sources of funds with the longest maturity, in order to avoid liquidity crises
• B)funding long-term assets with long-term sources, and short-term assets with short terms borrowings.
• C)using as much short-term financing as possible due to the lower cost of interest
• D)buying marketable securities when demand is high and borrowing short term when demand is low

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Definitions:

Statistic

A numerical value that describes a sample characteristic, obtained from data analysis.

Sample

A subset of a population selected for measurement, observation, or questioning to provide statistical information about the population.

Net Fixed Assets

The value of a company's property, plant, and equipment (PP&E) minus any accumulated depreciation, representing the actual value of the company's fixed assets.

Sales

The process of offering goods or services to obtain money or other forms of payment.