Question

Liquidity is important to investors in a money market fund because:  A. investors generally invest long term in money market shares.   B. liquidity provides a guarantee against loss of principal.   C. many investor transactions are likely to occur.   D. shares are sold to the public at a specified price.

Answer 1

The right answer for the question that is being asked and shown above is that: "C. many investor transactions are likely to occur. " Liquidity is important to investors in a money market fund because many investor transactions are likely to occur. 

Answer 2

Liquidity is important to investors in a money market fund because "many investor transactions are likely to occur".

Liquidity depicts how much a benefit or security can be rapidly purchased or sold in the market without influencing the advantage's cost.  

Market liquidity alludes to the degree to which a market, for example, a nation's securities exchange or a city's land showcase, enables advantages for be purchased and sold at stable costs. Money is viewed as the most fluid resource, while land, compelling artwork and collectibles are all moderately illiquid.