Which term describes money that is immediately accessible in banknotes and coins?

Which term describes money that is immediately accessible in banknotes and coins?

• A. Liquid assets
• B. Investments
• C. Cash
• D. Reserves

Answer: (C)

The term that describes money that is immediately accessible in banknotes and coins is cash. Cash represents the most liquid form of money, meaning it can be used directly for transactions without any need for conversion or delay. It is readily available for spending, allowing individuals or businesses to meet their immediate financial obligations. While liquid assets also refer to assets that can be easily converted to cash, cash specifically points to physical currency. Investments, on the other hand, typically involve purchasing assets with the expectation of earning returns over time and do not include cash or coins directly. Reserves might refer to funds set aside for a specific purpose or savings, but again, this term lacks the immediacy and accessibility that characterize cash. Therefore, cash is the most appropriate term for money that one can use right away in its tangible form.

The term that describes money that is immediately accessible in banknotes and coins is cash. Cash represents the most liquid form of money, meaning it can be used directly for transactions without any need for conversion or delay. It is readily available for spending, allowing individuals or businesses to meet their immediate financial obligations.

While liquid assets also refer to assets that can be easily converted to cash, cash specifically points to physical currency. Investments, on the other hand, typically involve purchasing assets with the expectation of earning returns over time and do not include cash or coins directly. Reserves might refer to funds set aside for a specific purpose or savings, but again, this term lacks the immediacy and accessibility that characterize cash. Therefore, cash is the most appropriate term for money that one can use right away in its tangible form.