Which asset would you classify as being most liquid?ademand depositsbsmall-time depositsca homedgold bullion

The most liquid asset among the options provided is "demand deposits". Here's why:

1. Liquidity refers to the ease with which an asset can be converted into cash without affecting its market price. The more quickly and easily an asset can be converted into cash, the more liquid the asset is considered to be.

2. Demand deposits are funds held in a bank account from which deposited funds can be withdrawn at any time without any advance notice to the depository institution. This means you can convert it into cash almost instantly, making it highly liquid.

3. Small-time deposits, also known as term deposits, are not as liquid because they have a fixed term. You can't withdraw these funds before the term ends without incurring a penalty.

4. A home is considered a non-liquid asset because it can take a significant amount of time to sell and convert into cash. The process includes finding a buyer, negotiating the price, and closing the sale, which can take weeks or even months.

5. Gold bullion is more liquid than a home or small-time deposits, but less liquid than demand deposits. While it can be sold relatively quickly, it still requires finding a buyer and possibly having the gold assessed, which can take time.

So, in order of most to least liquid, the assets would be ranked as follows: demand deposits, gold bullion, small-time deposits, and a home.