What term is commonly used to describe a firm that has more assets than liabilities?

The term that describes a firm having more assets than liabilities is solvency. Solvency indicates that a company's total assets exceed its total liabilities, which is a crucial aspect of its financial health. A solvent firm can meet its long-term obligations, demonstrating financial stability and the ability to grow and invest in future opportunities. This concept is fundamental in assessing a company's financial condition, as it shows that the firm is capable of covering its debts and has a positive net worth.

While liquidity refers to a firm's ability to meet short-term obligations with its most liquid assets, it does not specifically address the overall health of the firm in terms of total assets versus liabilities. Insolvency is the opposite of solvency, indicating that a firm has more liabilities than assets and cannot meet its financial obligations. Equity refers to the ownership interest in the firm, represented by the net assets after all liabilities have been deducted. Thus, solvency is the most appropriate term to describe a firm that possesses more assets than liabilities.