Which of the Following Observations Is NOT True of a Liquid

question 38

Multiple Choice

Which of the following observations is NOT true of a liquid asset?

• A)It can be turned into cash quickly.
• B)Conversion to cash entails low transaction costs.
• C)Conversion to cash happens with little or no loss in principal value.
• D)It is traded in an active market.
• E)Large transactions may move its market price substantially.

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Definitions:

Scatter Diagram

A graphical representation using dots to show the relationship between two sets of data, helping identify any correlation trends.

Break-Even Point

The point at which total revenues equal total expenses, meaning there is no profit or loss, and the business has covered all its costs.

Variable Cost

Charges that move in direct relationship with the quantity of goods produced or sold, embracing materials and labor expenses.

Units

Basic measures or quantities of product or service in business, used in accounting and production.