In its June 30, 2018, balance sheet, Microsoft Corporation reports an investment in available for-sale fixed- income (debt) securities with a value of $ 129,475. As available-for-sale securities, these investments are reported at their fair value, and Microsoft provides the following information in its footnotes.

a. Explain the differences between the three columns labeled Level 1, Level 2, and Level 3.
b. Are all of these investments "marked-to-fair value"? If not, which ones are not marked-to-fair value? Which investment values do you regard as most subjective? Least subjective?
c. If Microsoft needed to raise cash to take advantage of an investment opportunity, which of these investments do you regard as most liquid (i.e., most easily turned into cash)? Least liquid?

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Gross Fair June 30, 2018 (In $ millions) Level 1 Level 2 Level 3 Value Commercial paper. Certificates of deposit. U.S. government and agency securities. Foreign government bonds. . Mortgage- and asset-backed securities Corporate notes and bonds Municipal securities . $2,513 2,058 1,742 5,054 $ 2,513 2,058 108,757 5,076 107.015 22 3,855 3,855 6,894 307 15 6,909 307