Cash flow insolvency involves a lack of liquidity to pay debts as they fall due.Question 2Select one:TrueFalse

Insolvency is the inability of a debtor to pay their debt.Question 6Select one:TrueFalse

Insolvency is not a synonym for bankruptcy.Question 9Select one:TrueFalse

Balance sheet insolvency involves having no net assets-with no liabilities that exceed assets. Question 1Select one: True False

Which of the following situations can lead to a liquidity deficit? (multiple answers may be correct)Group of answer choicesAn investigative journalist highlights that your bank has poor liquidity managementYou have large credit commitments exclusively to firms with highly volatile cashflows. These firms are now hit with a negative shock.Your shareholders request that 90% of this year's profit is distributed in the form of dividends.The value of your trading portfolio value drops by 30%.The value of your investment portfolio value drops by 30%

Balance sheet insolvency involves having negative net assets-where liabilities exceed assets.Question 5Select one:TrueFalse