Answered

Join IDNLearn.com and become part of a knowledge-sharing community that thrives on curiosity. Get prompt and accurate answers to your questions from our community of experts who are always ready to help.

Secured short-term loans are usually secured by:

A. accounts payable and accounts receivable
B. buildings and equipment
C. equipment and inventory
D. inventory and raw material
E. accounts receivable and inventory

Sagot :

GinnyAnsweridn

Final answer:

Secured short-term loans are backed by accounts receivable and inventory, offering lower interest rates due to collateral and highlighting the importance of asset liquidity in banking.


Explanation:

Secured short-term loans are typically secured by accounts receivable and inventory. This means that in case the borrower defaults on the loan, the lender can claim these assets to recover some of the lost loan value.

Secured loans involve having an asset pledged as collateral to minimize the lender's risk. Unlike unsecured loans, secured loans offer lower interest rates due to the collateral involved, providing an advantage to both the borrower and the lender.

Liquidity plays a crucial role in banking, with assets organized based on how easily they can be converted to cash. The most liquid assets, like cash and short-term loans, appear at the top of the balance sheet, highlighting their importance in maintaining a bank's financial stability.


Learn more about Secured short-term loans here:

https://brainly.com/question/34338114


We are happy to have you as part of our community. Keep asking, answering, and sharing your insights. Together, we can create a valuable knowledge resource. Thanks for visiting IDNLearn.com. We’re dedicated to providing clear answers, so visit us again for more helpful information.