the economics of money, banking, and financial markets

70 #

© 2014 Pearson Canada Inc.#

25. 
    

    ____ is the relative ease and speed with which an asset can be converted into a medium
    of exchange.
    A) Efficiency
    B) Liquidity
    C) Deflation
    D) Specialization
    Answer: B
    Diff: 1 Type: MC Page Ref: 49
    Skill: Recall
    Objective List: 3.2 Distinguish among the three primary functions of money

    
    


26. 
    

    Increasing transactions costs of selling an asset make the asset ____.
    A) more valuable
    B) more liquid
    C) less liquid
    D) more moneylike
    Answer: C
    Diff: 1 Type: MC Page Ref: 49 - 50
    Skill: Recall
    Objective List: 3.2 Distinguish among the three primary functions of money

    
    


27. 
    

    Since it does not have to be converted into anything else to make purchases, ____ is the
    most liquid asset.
    A) money
    B) stock
    C) artwork
    D) gold
    Answer: A
    Diff: 1 Type: MC Page Ref: 49
    Skill: Recall
    Objective List: 3.2 Distinguish among the three primary functions of money

    
    


28. 
    

    Of the following assets, the least liquid is ____.
    A) stocks
    B) travellers cheques
    C) chequing deposits
    D) a house
    Answer: D
    Diff: 1 Type: MC Page Ref: 49 - 50
    Skill: Applied
    Objective List: 3.2 Distinguish among the three primary functions of money