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The following article will add knowledge about “Consider the relative liquidity of the following assets“. Let’s not forget to look at the content!
Question
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Answer “Consider the relative liquidity of the following assets”.
Liquidity
Liquid Asset is defined as the cash or other asset that can easily be converted into cash. Cash is a most liquid asset and after that bank cheque, DD, a money order can easily be converted in cash that is why they are considered as near to most liquid asset. Assets that are difficult to sell can be considered least liquid assets. If you can’t sell your home and turn it into cash, then your home is considered the least liquid asset.
Answer:
Most liquid: – 1.A $5 bill
Second most liquid: – 2. The funds in a money market account
Third most liquid: – 4. Share of stock
Least liquid: – 3. Your House
Explanation:
Liquidity is the speed at which an asset can convert into cash or another medium of exchange.
So, here a $5 bill is the most liquid asset listed here.
The Second most liquid asset is the funds in a money market account
The third most liquid asset is Share of stock
The least liquid asset is your house
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