illiquid definition

illiquid

Firm without enough cash to meet its current needs and obligations. Illiquidity is one of the major causes of business failure because a firm can survive without profit for a while but not without cash. Even firms rich in fixed assets (land, buildings, machinery) become insolvent from want of cash because it takes time to convert these assets into cash, and that too usually at a loss in value.

illiquid is in the Accounting & Auditing and Banking, Commerce & Finance subjects.

illiquid appears in the definitions of the following terms: private equity, lender of last resort and liquidity risk

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