Which asset is generally considered the most liquid?
Correct answer: A. Cash in hand
- A. Cash in hand
- B. Land and buildings
- C. Long-term government bonds
- D. Machinery and equipment
Explanation
Liquidity means how quickly an asset can be converted into cash without a significant loss in value. Cash is already available for immediate use, whereas the other assets require time to sell.
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About Finance and Banking Basics
Business finance covers capital requirements, sources of funds, budgeting, cash flow, investment decisions and basic financial statements and ratios. Banking includes commercial bank functions, deposits, loans, credit creation, interest and the role of a central bank, including its monetary policy and regulatory functions.
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