Which asset is most liquid?
Understand the Problem
The question is asking about the characteristics of liquidity in assets, specifically which type of asset can be easily converted into cash or has the highest liquidity.
Answer
cash
The final answer is cash.
Answer for screen readers
The final answer is cash.
More Information
Cash is considered the most liquid asset because it can be used immediately to settle financial obligations without any conversion.
Tips
A common mistake is confusing highly liquid assets like stocks and bonds with cash, which requires no conversion.
Sources
- What Is a Liquid Asset, and What Are Some Examples? - Investopedia - investopedia.com
- What are liquid assets and non-liquid assets? - Brex - brex.com
- Understanding Liquidity And Liquid Assets - Investing - Forbes - forbes.com
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