Liquidity of an asset refers to:
A) its level of risk.
B) whether it is held domestically or overseas.
C) the ease with which it can be sold.
D) its volatility.

Question

Quizplus · Accepted Answer

Liquidity refers to how easily an asset can be converted into cash without affecting its market price. The ease with which an asset can be sold is directly related to its liquidity. Therefore, option C is the correct answer. Options A, B, and D are all incorrect because they do not relate to liquidity.

Liquidity of an Asset Refers To