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Answer Posted / gaurav mishra
liquidity means hard cash in hand or in bank or the assets
that can be canverted into cash very easily, it is better
to manage the liquidity in firm because if the firm is
having liquid in access it will eduse the return on
investment because money is in the hand it is not invested
somewhere but if the amount of liqued is lesser to the need
it can interrupt the business or production or the process
of any firm. in the production firms the ratio of liquidity
is maintained hegher than the business firm.
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