Determining the highly liquid asset


The following statements compare a highly liquid asset against an (otherwise similar) illiquid asset. Which statement is most likely to be false?

A. It is possible to trade a larger quantity of the liquid asset without affecting the price.

B. The liquid asset has a smaller bid-ask spread.

C. The liquid asset has higher price volatility since it trades more often.

D. The liquid asset has higher trading volume.

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Finance Basics: Determining the highly liquid asset
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