BANKING AFFAIRS

Detailed explanation-1: -For example, the money in your checking account, savings account, or money market account is considered liquid because it can be withdrawn easily to settle liabilities.

Detailed explanation-2: -Certificate of deposit is the least liquid type of account (CD). In a certificate of deposit, a bank customer deposits a lump-sum payment in the account, which can then be withdrawn after a set period of time. The interest rate on a CD is higher than on a regular savings account.

Detailed explanation-3: -Cash and Cash Equivalents Cash is considered the most liquid asset because it’s readily available to use. Cash can be paper money, coins, or checking or savings account balances. Cash is very useful for immediate needs and expenses, such as daily spending, rent and building an emergency fund.

Detailed explanation-4: -Cash and Cash Equivalents Cash is the most liquid asset possible as it is already in the form of money. This includes physical cash, savings account balances, and checking account balances.