Narrow Bid-Offer Spreads Are an Indicator of an Illiquid Market

question 72

True/False

Narrow bid-offer spreads are an indicator of an illiquid market.

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Definitions:

Financial Account

A component of a country's balance of payments that records transactions of foreign investment and domestic investments abroad.

Capital Account

A national account that shows the net change in asset ownership for a country, including transactions like foreign investments and loans.

Financial Account

A component of a country's balance of payments that records all transactions for investment in foreign assets and liabilities.

Current Account

Part of a country's balance of payments, including the trade balance, net income from abroad, and net current transfers, reflecting the difference between a nation's savings and its investment.