A floating inventory lien is most attractive when the firm has a stable level of inventory that consists of a diversified group of relatively inexpensive merchandise.

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A floating inventory lien is a type of security interest that allows the lender to take collateral in a company's inventory. This type of lien is particularly useful when the inventory is diverse and low-cost, as it allows the lender to more easily recover their investment in the event of default. Additionally, a stable level of inventory means that the lender can be more confident in the value of the collateral over time.

A Floating Inventory Lien Is Most Attractive When the Firm