54.7k views
2 votes
The ease with which an asset can be

A. traded for another asset determines whether or not that asset is a unit of account.
B. transported from one place to another determines whether or not that asset could serve as fiat money.
C. converted into a store of value determines the liquidity of that asset.
D. converted into the economy’s medium of exchange determines the liquidity of that asset.

1 Answer

3 votes

ANSWER :

D. Converted into country's medium of exchange determines liquidity of the asset

EXPLANATION :

Liquidity is trait of an asset which refers to its ease of being used as a 'medium of exchange' , 'purchasing power tool' . Ex : Monetary currency being legal tender money (i.e legally bound to be accepted) is the most liquid asset . Cheqeuable deposits , plastic money are also relatively liquid . But : Land / Financial Shares might be not that easily convertible into a form of money which can be used as a 'medium of exchange' , ,purchasing power tool'

User Jishad
by
8.9k points

No related questions found

Welcome to QAmmunity.org, where you can ask questions and receive answers from other members of our community.

9.4m questions

12.2m answers

Categories