Question

Liquid Assets are inclusive of all current assets but current assets are not inclusive of liquid assets

Answer 1

Current assets are those assets which can be converted into cash within a short period of time. These assets include cash, bank balance, accounts receivable, inventory, prepaid expenses etc.
Liquid assets are considered more liquid than current assets. It is assumed that these assets can be converted into cash within a very short time period. For this purpose, liquid assets include current assets like cash, bank balance, accounts receivable etc. and excludes inventory and prepaid expenses.
Liquid assets are assumed to be converted into cash at any point of time.