Which of the Following Is NOT One of the Baumol

question 70

Multiple Choice

Which of the following is NOT one of the Baumol model's unrealistic assumptions?

• A) The firm has a constant, perfectly predictable distribution rate for cash.
• B) No cash will come in during the period in question.
• C) no allowance for any safety stock of extra cash to buffer the firm against unexpectedly high demand for cash
• D) no assumption to start from a replenishment level of cash then decline smoothly to a value of zero

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