Which term describes cash or cash equivalents that can be quickly accessed?

The term that describes cash or cash equivalents that can be quickly accessed is liquidity. Liquidity refers to how easily an asset can be converted into cash without affecting its market price. In personal finance, having liquid assets means having the availability of funds to meet immediate needs or expenses. Cash is the most liquid asset, while cash equivalents, such as money market accounts or short-term treasury bills, also fall under this category as they can be readily accessed without significant delay.

In financial contexts, liquidity is crucial because it indicates the ability to fulfill short-term obligations, handle emergencies, or seize investment opportunities. Understanding liquidity helps individuals and businesses manage their finances effectively, ensuring they can navigate unforeseen expenses or economic changes smoothly.

In contrast, assets encompass everything owned that has value, liabilities refer to obligations or debts owed, and capital typically pertains to financial resources or funds available for investment and growth. While these terms are related to finance, they do not specifically convey the immediacy of accessing cash or cash equivalents like liquidity does.