An Automobile Is an Asset, but It Is Not Liquid

question 55

Multiple Choice

An automobile is an asset, but it is not liquid because:

• A) the transactions costs for turning it into money are high.
• B) the owner may still be making payments on the loan.
• C) the automobile may not be in good repair.
• D) the automobile cannot be sold without a loss in value.

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Definitions:

Standard Construction Rule

A theory of legal interpretation under which the court will determine the principal objective of the parties in the making of the contract.

Principal Objective

The main goal that the parties to a contract hoped to meet by entering the contract in the first place.

Admissions

The process of allowing people to enter a place, institution, or specific program, often based on certain criteria.

Oral Contracts

Agreements made through spoken words rather than written documents, which can be legally binding but are often harder to prove.