ECONOMICS (CBSE/UGC NET)

ECONOMICS

MONEY

Question [CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
Money that is invested in stocks is more liquid than money in a savings account.
A
True
B
False
C
Either A or B
D
None of the above
Explanation: 

Detailed explanation-1: -Cash is the most liquid asset followed by cash equivalents, which are things like money markets, CDs, or time deposits. Marketable securities such as stocks and bonds listed on exchanges are often very liquid and can be sold quickly via a broker. Gold coins and certain collectibles may also be readily sold for cash.

Detailed explanation-2: -Stocks and marketable securities, which are considered liquid assets because these assets can be converted to cash in a relatively short period of time in the event of a financial emergency.

Detailed explanation-3: -Some examples of these liquid assets are cash, checking accounts, savings accounts and some investment funds.

Detailed explanation-4: -Cash and cash-like assets are considered the most liquid. But some types of securities are relatively liquid too. Marketable securities are ones that are easy to sell and convert into cash while holding their value. Common stocks and public bonds are typically the most-liquid types of securities.

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