{"id":48078,"date":"2024-04-15T22:36:04","date_gmt":"2024-04-15T22:36:04","guid":{"rendered":"https:\/\/exam.pscnotes.com\/mcq\/?p=48078"},"modified":"2024-04-15T22:36:04","modified_gmt":"2024-04-15T22:36:04","slug":"a-premium-charged-by-lenders-for-securities-that-cannot-be-converted-into-cash-is-classified-as","status":"publish","type":"post","link":"https:\/\/exam.pscnotes.com\/mcq\/a-premium-charged-by-lenders-for-securities-that-cannot-be-converted-into-cash-is-classified-as\/","title":{"rendered":"A premium charged by lenders for securities that cannot be converted into cash is classified as"},"content":{"rendered":"<p>[amp_mcq option1=&#8221;required premium&#8221; option2=&#8221;liquidity premium&#8221; option3=&#8221;marketability premium&#8221; option4=&#8221;Both B and C&#8221; correct=&#8221;option2&#8243;]<!--more--><\/p>\n<p>The correct answer is: <strong>Both B and C<\/strong>.<\/p>\n<p>A liquidity premium is a premium charged by lenders for securities that cannot be converted into cash quickly and easily. A marketability premium is a premium charged by lenders for securities that are not well-known or traded frequently.<\/p>\n<p>Securities that cannot be converted into cash quickly and easily are less liquid than securities that can be converted into cash quickly and easily. This is because it may be difficult to find a buyer for a security that is not liquid, and it may take longer to sell a security that is not liquid. As a result, lenders charge a liquidity premium for securities that are not liquid.<\/p>\n<p>Securities that are not well-known or traded frequently are less marketable than securities that are well-known and traded frequently. This is because it may be difficult to find a buyer for a security that is not well-known, and it may take longer to sell a security that is not well-known. As a result, lenders charge a marketability premium for securities that are not well-known.<\/p>\n<p>Therefore, a premium charged by lenders for securities that cannot be converted into cash is classified as both a liquidity premium and a marketability premium.<\/p>\n","protected":false},"excerpt":{"rendered":"<p>[amp_mcq option1=&#8221;required premium&#8221; option2=&#8221;liquidity premium&#8221; option3=&#8221;marketability premium&#8221; option4=&#8221;Both B and C&#8221; correct=&#8221;option2&#8243;]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[945],"tags":[],"class_list":["post-48078","post","type-post","status-publish","format-standard","hentry","category-financial-management","no-featured-image-padding"],"yoast_head":"<!-- This site is optimized with the Yoast SEO Premium plugin v22.2 (Yoast SEO v23.3) - https:\/\/yoast.com\/wordpress\/plugins\/seo\/ -->\n<title>A premium charged by lenders for securities that cannot be converted into cash is classified as<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/exam.pscnotes.com\/mcq\/a-premium-charged-by-lenders-for-securities-that-cannot-be-converted-into-cash-is-classified-as\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"A premium charged by lenders for securities that cannot be converted into cash is classified as\" \/>\n<meta property=\"og:description\" content=\"[amp_mcq option1=&#8221;required premium&#8221; option2=&#8221;liquidity premium&#8221; option3=&#8221;marketability premium&#8221; option4=&#8221;Both B and C&#8221; correct=&#8221;option2&#8243;]\" \/>\n<meta property=\"og:url\" content=\"https:\/\/exam.pscnotes.com\/mcq\/a-premium-charged-by-lenders-for-securities-that-cannot-be-converted-into-cash-is-classified-as\/\" \/>\n<meta property=\"og:site_name\" content=\"MCQ and Quiz for Exams\" \/>\n<meta property=\"article:published_time\" content=\"2024-04-15T22:36:04+00:00\" \/>\n<meta name=\"author\" content=\"rawan239\" \/>\n<meta name=\"twitter:card\" content=\"summary_large_image\" \/>\n<meta name=\"twitter:label1\" content=\"Written by\" \/>\n\t<meta name=\"twitter:data1\" content=\"rawan239\" \/>\n\t<meta name=\"twitter:label2\" content=\"Est. reading time\" \/>\n\t<meta name=\"twitter:data2\" content=\"1 minute\" \/>\n<!-- \/ Yoast SEO Premium plugin. -->","yoast_head_json":{"title":"A premium charged by lenders for securities that cannot be converted into cash is classified as","robots":{"index":"index","follow":"follow","max-snippet":"max-snippet:-1","max-image-preview":"max-image-preview:large","max-video-preview":"max-video-preview:-1"},"canonical":"https:\/\/exam.pscnotes.com\/mcq\/a-premium-charged-by-lenders-for-securities-that-cannot-be-converted-into-cash-is-classified-as\/","og_locale":"en_US","og_type":"article","og_title":"A premium charged by lenders for securities that cannot be converted into cash is classified as","og_description":"[amp_mcq option1=&#8221;required premium&#8221; option2=&#8221;liquidity premium&#8221; option3=&#8221;marketability premium&#8221; option4=&#8221;Both B and C&#8221; correct=&#8221;option2&#8243;]","og_url":"https:\/\/exam.pscnotes.com\/mcq\/a-premium-charged-by-lenders-for-securities-that-cannot-be-converted-into-cash-is-classified-as\/","og_site_name":"MCQ and Quiz for Exams","article_published_time":"2024-04-15T22:36:04+00:00","author":"rawan239","twitter_card":"summary_large_image","twitter_misc":{"Written by":"rawan239","Est. reading time":"1 minute"},"schema":{"@context":"https:\/\/schema.org","@graph":[{"@type":"WebPage","@id":"https:\/\/exam.pscnotes.com\/mcq\/a-premium-charged-by-lenders-for-securities-that-cannot-be-converted-into-cash-is-classified-as\/","url":"https:\/\/exam.pscnotes.com\/mcq\/a-premium-charged-by-lenders-for-securities-that-cannot-be-converted-into-cash-is-classified-as\/","name":"A premium charged by lenders for securities that cannot be converted into cash is classified as","isPartOf":{"@id":"https:\/\/exam.pscnotes.com\/mcq\/#website"},"datePublished":"2024-04-15T22:36:04+00:00","dateModified":"2024-04-15T22:36:04+00:00","author":{"@id":"https:\/\/exam.pscnotes.com\/mcq\/#\/schema\/person\/5807dafeb27d2ec82344d6cbd6c3d209"},"breadcrumb":{"@id":"https:\/\/exam.pscnotes.com\/mcq\/a-premium-charged-by-lenders-for-securities-that-cannot-be-converted-into-cash-is-classified-as\/#breadcrumb"},"inLanguage":"en-US","potentialAction":[{"@type":"ReadAction","target":["https:\/\/exam.pscnotes.com\/mcq\/a-premium-charged-by-lenders-for-securities-that-cannot-be-converted-into-cash-is-classified-as\/"]}]},{"@type":"BreadcrumbList","@id":"https:\/\/exam.pscnotes.com\/mcq\/a-premium-charged-by-lenders-for-securities-that-cannot-be-converted-into-cash-is-classified-as\/#breadcrumb","itemListElement":[{"@type":"ListItem","position":1,"name":"Home","item":"https:\/\/exam.pscnotes.com\/mcq\/"},{"@type":"ListItem","position":2,"name":"Financial management","item":"https:\/\/exam.pscnotes.com\/mcq\/category\/financial-management\/"},{"@type":"ListItem","position":3,"name":"A premium charged by lenders for securities that cannot be converted into cash is classified as"}]},{"@type":"WebSite","@id":"https:\/\/exam.pscnotes.com\/mcq\/#website","url":"https:\/\/exam.pscnotes.com\/mcq\/","name":"MCQ and Quiz for Exams","description":"","potentialAction":[{"@type":"SearchAction","target":{"@type":"EntryPoint","urlTemplate":"https:\/\/exam.pscnotes.com\/mcq\/?s={search_term_string}"},"query-input":"required name=search_term_string"}],"inLanguage":"en-US"},{"@type":"Person","@id":"https:\/\/exam.pscnotes.com\/mcq\/#\/schema\/person\/5807dafeb27d2ec82344d6cbd6c3d209","name":"rawan239","image":{"@type":"ImageObject","inLanguage":"en-US","@id":"https:\/\/exam.pscnotes.com\/mcq\/#\/schema\/person\/image\/","url":"https:\/\/secure.gravatar.com\/avatar\/761a7274f9cce048fa5b921221e7934820d74514df93ef195a9d22af0c1c9001?s=96&d=mm&r=g","contentUrl":"https:\/\/secure.gravatar.com\/avatar\/761a7274f9cce048fa5b921221e7934820d74514df93ef195a9d22af0c1c9001?s=96&d=mm&r=g","caption":"rawan239"},"sameAs":["https:\/\/exam.pscnotes.com"],"url":"https:\/\/exam.pscnotes.com\/mcq\/author\/rawan239\/"}]}},"amp_enabled":true,"_links":{"self":[{"href":"https:\/\/exam.pscnotes.com\/mcq\/wp-json\/wp\/v2\/posts\/48078","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/exam.pscnotes.com\/mcq\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/exam.pscnotes.com\/mcq\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/exam.pscnotes.com\/mcq\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/exam.pscnotes.com\/mcq\/wp-json\/wp\/v2\/comments?post=48078"}],"version-history":[{"count":0,"href":"https:\/\/exam.pscnotes.com\/mcq\/wp-json\/wp\/v2\/posts\/48078\/revisions"}],"wp:attachment":[{"href":"https:\/\/exam.pscnotes.com\/mcq\/wp-json\/wp\/v2\/media?parent=48078"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/exam.pscnotes.com\/mcq\/wp-json\/wp\/v2\/categories?post=48078"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/exam.pscnotes.com\/mcq\/wp-json\/wp\/v2\/tags?post=48078"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}