Question

Select the correct answers from each drop-down menu. what is the significance of having short-term investments? a company usually has short-term investments because it can these investments into cash quickly if it faces a cash .

Answer 1

Short-term investments are significant for companies as they can be quickly converted into cash, thus offering liquidity during cash shortfalls or for seizing new business opportunities.

Step-by-step explanation:

The significance of having short-term investments is primarily associated with their liquidity. It means that a company usually has short-term investments because it can convert these investments into cash quickly if it faces a cash shortfall. The ability to liquidate such investments quickly is crucial for managing cash flow, dealing with unexpected expenses, or taking advantage of new business opportunities without having to secure loans or other forms of financing.