Which of the following best defines market liquidity?

Market liquidity refers to the ability to buy or sell assets in the market without causing a significant change in their price. This definition captures the essence of liquidity as it emphasizes not only the ability to transact but also the influence those transactions have on the asset's price. When a market is considered highly liquid, it means that large quantities of an asset can be traded quickly with minimal price fluctuations, indicating a healthy market where buyers and sellers can interact freely.

The other options do not encompass the full concept of market liquidity. For instance, while speed and ease of cash transactions might relate to liquidity, they don't address the impact on asset prices. Quantity of assets available in the market provides a context for liquidity but does not directly define it. Profitability of trading activities may be a result of liquidity but is not a defining characteristic. Therefore, the explanation of market liquidity as the ability to transact without price impact captures the core idea effectively.