Question

Market ______ is a market's feature whereby an individual or firm can quickly purchase or sell an asset without causing a drastic change in the asset's price.

A) Volatility
B) Illiquidity
C) Liquidity
D) Congestion

Answer 1

Liquidity is a market's feature whereby an individual or firm can quickly purchase or sell an asset without causing a drastic change in the asset's price.

Step-by-step explanation:

Liquidity is a market's feature whereby an individual or firm can quickly purchase or sell an asset without causing a drastic change in the asset's price.

For example, in a liquid market, if a seller wants to sell a stock, they can do so without significantly affecting the stock's price because there are many buyers available who are willing to buy the stock at various prices.

Therefore, the correct answer is Liquidity (C).