One good reason to hold cash is that cash provides more liquidity than other marketable securities.

Question

Quizplus · Accepted Answer

Cash can be easily and immediately converted into goods or services, which makes it the most liquid asset. Marketable securities, such as stocks and bonds, may take time to sell and may result in losses due to fluctuations in market prices. Therefore, holding cash provides more liquidity than other marketable securities.

One Good Reason to Hold Cash Is That Cash Provides