Question: The table below indicates the fair market value (that is, value if sold in the ordinary course of business) of assets of two financial institutions,

The table below indicates the fair market value (that is, value if sold in the ordinary course of business) of assets of two financial institutions, and the portion of market value the institution expects to receive for each asset class if it is liquidated on short notice. Compute the liquidity index of each institution and compare the two institutions liquidity risk.

A	B	portion of market value
77000	60000	100%
680	630	99%
7200	7700	96%
80000	6300	92.5%
7300	510	86%
9900	83000	63.5%
6600	610	42%

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