ECONOMICS
SAVING AND INVESTING
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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how easy it is to turn an item into cash without losing any money
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how easy it is to lose money when you invest in a risky business.
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the ability of savings to earn interest.
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the potential loss from rising prices.
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Detailed explanation-1: -Liquidity refers to the ease with which an asset, or security, can be converted into ready cash without affecting its market price. Cash is the most liquid of assets, while tangible items are less liquid. The two main types of liquidity include market liquidity and accounting liquidity.
Detailed explanation-2: -Share. Liquidity definition. Liquidity is a company’s ability to convert assets to cash or acquire cash-through a loan or money in the bank-to pay its short-term obligations or liabilities.
Detailed explanation-3: -Financial liquidity refers to how easily assets can be converted to ready cash without affecting its market price. Assets like stocks and bonds are very liquid and can be converted into cash within days.
Detailed explanation-4: -Ans: Liquidity of money refers to the ability by which money can be immediately converted into goods and services required by the holder of money. Money is considered to be the most liquid asset because it can be easily converted into other assets.
Detailed explanation-5: -Liquidity is a measure of the cash and other assets banks have available to quickly pay bills and meet short-term business and financial obligations. Capital is a measure of the resources banks have to absorb losses.