Which of the Following Assets Has Become Significantly More Liquid

question 38

Multiple Choice

Which of the following assets has become significantly more liquid during the past two decades?

• A)U.S. currency
• B)U.S. government bonds
• C)Mortgage loans
• D)Bonds issued by large corporations

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Definitions:

Inflation

The rate at which the general level of prices for goods and services is rising, eroding purchasing power.

Positive Economic Statement

A factual claim about the world that can be tested and validated, referring to what is, rather than what ought to be.

Normative

Normative relates to an ideal standard or model, often reflecting opinions about what is desirable or how things should be, especially in ethics and economics.

Gasoline

A petroleum-derived liquid mixture consisting mainly of hydrocarbons, used primarily as fuel in internal combustion engines.