Question

Holders of assets can readily sell their financial assets through the mechanism of the financial market. This is because financial markets provide _________.

• A. valuable information about securities being traded in the market
• B. assistance in Price Discovery
• C. liquidity to Financial Assets
• D. all of the above

Answer 1

The correct option is C liquidity to Financial Assets

Holders of assets can readily sell their financial assets through the mechanism of the financial market. This is because financial markets provide liquidity to Financial Assets. Liquidity of financial assets means that financial assets can be converted into cash in a short time, with little or no loss in value.