Impact on Liquidity Optimal Amount(Level)of Current Assets Liquidity Analysis Policy Liquidity/2 Policy A Policy B ABc High Average Policy C LoW Current Assets Greater current asset levels generate more liquidity all other factors held constant 25,000 50,000 OUTPUT(units) 8-68-6 Impact on Liquidity Liquidity Analysis Policy Liquidity A High B Average C Low Greater current asset levels generate more liquidity all other factors held constant. Optimal Amount (Level) of Current Assets 0 25,000 50,000 OUTPUT (units) ASSET LEVEL ($) Current Assets Policy C Policy A Policy B