TM 3

is a set of ongoing strategies and

processes that ensure your business is able to access cash as

needed — to pay for goods and services, make payroll and

invest in new opportunities that arise.

Answer explanation

Liquidity management

refers to a set of processes,

strategies, and supporting mechanisms/tools that ensure a

business or bank is able to access cash when and where it is

needed.

Answer explanation

Liquidity management

refer to the financial obligations of

a business or financial institution that are due to be paid

within a relatively short period, typically within one year.

Answer explanation

Liquid liabilities

represent funds that must be made

available to creditors, depositors, or other parties in the

near term.

Answer explanation

Liquid liabilities

are important for assessing

the short-term financial health and liquidity of an

organization.

Answer explanation

Liquid liabilities

: Funds held in checking accounts or

other deposit accounts that customers can withdraw on

demand without any notice.

Answer explanation

Demand Deposits

: Funds held in savings accounts that

customers can withdraw with some notice, typically within

a few days.

Answer explanation

Savings Deposits

Time deposits with fixed maturity dates, but some of it may be liquidated before

maturity with a penalty.

Answer explanation

Certificates of Deposit (CDs):

: Loans or credit facilities with

maturities of one year or less, including interbank loans and

commercial paper.

Answer explanation

Short-Term Borrowings

: Amounts owed to suppliers or vendors for

goods or services purchased on credit, which are due to be paid

within the next year

Answer explanation

Accounts Payable