Suppose Bob Holds Cash Because He Expects to Need It

question 159

Multiple Choice

Suppose Bob holds cash because he expects to need it in the future and it may be costly for him to convert his assets into money later, then the reason Bob holds on to money is the:

• A) speculative demand for money.
• B) liquidity demand for money.
• C) transactions demand for money.
• D) All of the above are correct.

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Definitions:

Kaizen

A Japanese term for 'continuous improvement', focusing on small, incremental changes in processes to improve efficiency and quality.

Small Lot Sizes

Manufacturing or purchasing strategy characterized by producing or acquiring goods in small quantities, which can reduce inventory costs and improve flexibility.

Material Handling

The movement, protection, storage, and control of materials and products throughout manufacturing, warehousing, distribution, consumption, and disposal processes.

JIT

Just-In-Time; an inventory management strategy that aims to increase efficiency and decrease waste by receiving goods only as they are needed in the production process.