Which One of the Following Statements Concerning Liquidity Is Correct

question 35

Multiple Choice

Which one of the following statements concerning liquidity is correct?

• A)Liquid assets generally earn higher rates of return than fixed assets.
• B)If you can sell an asset next year at a price equal to its actual value,the asset is highly liquid.
• C)Liquid assets are defined as those assets obtained within the past year.
• D)The less liquidity a firm has,the lower the probability the firm will encounter financial difficulties.
• E)Balance sheet accounts are listed in order of decreasing liquidity.

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