Question

Liquidity refers to Group of answer choices the ease with which an asset is converted to the medium of exchange. the measurement of the intrinsic value of commodity money. the measurement of the durability of a good. how many time a dollar circulates in a given year.

Answer 1

Answer:

The correct answer is letter "A": the ease with which an asset is converted to the medium of exchange.

Explanation:

The liquidity of an asset reflects the ease with which it can be transformed from investment to cash. Liquid assets are those that can be transformed easily to cash and see little or no difference in the value of the assets when transformed. Illiquid assets are more difficult to convert and can result in a major decrease in value once converted.