What is the cost of liquidity? What do you mean by the holding cost and short term cost of current a

The availability of liquidity has a huge impact on financial markets. The transaction cost of insufficient liquidity is called liquidity cost. At present, there is no unified concept in the academic community that can be convinced.

When investors trade positions in a short period of time, even if the trading volume is not very large, they often have to face a certain cost. These costs can be thought of as the liquidity costs incurred by the market due to insufficient liquidity.

1. In a narrow sense: liquidity cost refers to the indirect transaction cost caused by the impact of investors' investment and trading activities on the market.

2. In a broad sense: the three basic liquidities of reserves, convertible assets, and active liabilities belong to the category of commercial banks, and the chivalrous definition mentioned above can be understood as a loss of the velocity of money in Fisher's equation, that is, the loss caused by the lag of money or cash flow due to store or debt, or transaction in the flow process.

Narrow sense: the liquidity cost index is **impact index: refers to the degree of impact on the market caused by the completion of a certain amount (such as 100,000 yuan) or quantity (such as 10,000 shares). The larger the impact index, the higher the cost of the transaction and the worse the liquidity of the index.

In a broad sense (I think of it myself, for reference only): the three basic liquidities of reserves, convertible assets, and active liabilities belong to the category of commercial banks, plus the chivalrous definition mentioned above, so I think that the liquidity cost can be understood as a loss of the velocity of money in Fisher's equation, that is, the loss caused by the lag of money or cash flow due to store or debt, or transaction in the flow process.

It should be a liquid asset.

of carrying costs vs. shortages costs.

Bear a large cost of holding current assets, but the shortfall cost is small.

Changes in the same direction as investment in liquid assets.

Shortfall costs refer to costs that increase as the level of investment in liquid assets decreases.

For example, there is a cash shortage due to insufficient investment, which needs to be valuable and bear the transaction costs; When the problem is not sufficient, it is necessary to borrow urgently and bear high interest, etc.

Changes in the opposite direction to current asset investment.

What does total current balance sheet mean?

Total liquid liabilities refer to the balance sheet.

Total current liabilities. Current liabilities refer to debts that will be repaid within one year or more of a business cycle, including short-term borrowings, notes payable, accounts payable, wages payable, welfare payables, and accounts receivable in advance.

Taxes payable, profits payable. Other payables.

Withholding expenses, etc.

Liquid assets refer to the current assets on the balance sheet, which refer to the assets that are more liquid. Mainly include: cash, bank deposits, valuable**, accounts receivable.

Wait. Debt-to-asset ratio.

Total Liabilities Total Assets.

For an enterprise, the asset-liability ratio is 50% as the critical point, and more than 50% indicates that the risk of the enterprise borrowing is greater, but if the enterprise has a higher level of profitability, that is to say, the investment yield of the enterprise is higher than the loan interest rate, that is, there is still a surplus after the interest is paid on the profits generated by the borrowed funds, and the higher the asset-liability ratio, the greater the excess income brought to the enterprise and the owner. Therefore, the asset-liability ratio is 100% as the warning line, which means that the enterprise is insolvent and will face bankruptcy.

What does it mean to divide current assets by current liabilities.

Current assets divided by current liabilities is the current ratio.

The current ratio is the ratio of current assets to current liabilities, which is used to measure the ability of an enterprise's current assets to be turned into cash to repay liabilities before the maturity of short-term debts.

Refers to the ratio of total current assets to total current liabilities. The current ratio indicates the ability of the company's current assets to be realized to repay current liabilities when short-term debts mature, and should generally be greater than 200%.

Current Ratio = Total Current Assets Total Current Liabilities * 100%.

Liquid assets ((point, hit)).

The holding cost refers to the cost of holding the asset (such as cash, inventory, accounts receivable, etc.), including storage, insurance, opportunity cost, etc. A high cost of ownership can affect a business's profit margins and profitability. Short-term costs refer to the costs that are spent in a short period of time, usually within a year or a week, including raw material procurement, costs, transportation expenses, etc.

Short-term costs have a significant impact on a company's cash flow and short-term profitability.

Fixed cost refers to the part of the cost that remains relatively stable without the change of the total cost within a certain range of changes in the business volume, such as enterprise management expenses, sales expenses, workshop production management personnel salaries, employee welfare expenses, office expenses, depreciation of fixed assets, repair costs, etc. These costs, in terms of their total amount, do not increase or decrease within a certain range of changes in the output of the product or the flow of goods, but in terms of the cost of the unit product or the burden of the commodity, they change inversely with the output of the product or the flow of goods. That is, the increase in product output or commodity circulation leads to a decrease in the cost of unit product or commodity allocation;As the production of products or the flow of goods decreases, the cost of sharing per unit of product or commodity increases.

The variable costs mainly include: raw materials, packaging, turnover materials (low-value consumables), workers' salaries (including welfare, social security), machine material consumption, and other expenses (including water and electricity costs) excluding equipment depreciation from manufacturing costs. In fact, it is often referred to as "materials, labor, and expenses (excluding the depreciation of fixed assets)".

Variable costs are all in the "production process".