Final answer:
Cash equivalents are highly liquid financial assets close to maturity and easily convertible into cash without significant risk of value change, making all options true.
Step-by-step explanation:
Cash Equivalents and Liquidity
Cash equivalents are financial assets that are highly liquid and are close to their maturity date. They are easily convertible to cash and do not pose significant risks of changes in value due to their short-term nature. Therefore, all of the statements provided in the question are true. Cash equivalents include assets such as treasury bills, commercial paper, and money market funds, which can be quickly converted into cash with minimal impact on their value, thus offering a stable investment option for businesses and individuals.
Liquidity refers to the ease with which an asset can be converted into cash without affecting its market price. Cash equivalents are considered part of the M2 money supply, often referred to as 'near money' due to their close similarity in liquidity to actual cash (M1).