Which of the Following Are Characteristics of a Liquid Asset

question 11

Multiple Choice

Which of the following are characteristics of a liquid asset?

• A) Provide high yields.
• B) Are highly specialized equipment.
• C) There is a significant loss in value if sold.
• D) Include the firm's shares and bonds.
• E) Can be converted into cash quickly, with little or no loss in value, and generally earn low returns.

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Definitions:

Marginal Cost

Marginal cost is the increase in total cost that arises from producing one more unit of a good or service. It is a critical concept in economics for decision-making regarding production levels.

Purely Competitive Market

A market structure characterized by many buyers and sellers, all of whom are selling a homogeneous product, with no single buyer or seller able to influence the market price.

Economic Profit

The difference between total revenue and total costs, including both explicit and implicit costs, representing excess return over perfect competition.

Per-Unit Profit

The difference between the selling price of a product and its cost of production on a per-item basis, indicating the profit generated from selling one unit of product.