Liquidity is:
A) a measure of how easily a particular asset can be converted quickly to cash without much loss of value.
B) the speed with which dollars are spent in the economy.
C) the speed with which physical dollars change hands in the economy.
D) the magnitude of change in the money supply as controlled by the Fed.

Question

Quizplus · Accepted Answer

Liquidity refers to the degree to which an asset or security can be easily traded or exchanged for cash without affecting its market price. It is a measure of how quickly an asset can be converted into cash without causing a significant change in its market price.

Liquidity Is