Which of the Following Is True in the BAT Model

question 44

Multiple Choice

Which of the following is true in the BAT model?

• A) As the initial cash balance rises, opportunity costs fall.
• B) For a given initial cash balance, the total cost of holding cash will rise with decreases in opportunity costs.
• C) As average cash balances fall, opportunity costs rise.
• D) For a given initial cash balance, the total cost of holding cash will rise with decreases in the fixed cost of making a securities trade.
• E) A drawback to the BAT model is that it assumes steady, certain cash outflows.

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Definitions:

Sodium Hydroxide

A highly caustic compound, also known as lye, used in many industrial and chemical processes.

Lye

A strong alkaline solution, often sodium or potassium hydroxide, used in cleaning, soap making, and food preparation.

Acid Base

Refers to the mechanisms the body uses to maintain its normal acidic (pH less than 7) or basic (pH greater than 7) environment.

Boric Acid

A weak, water-soluble acid used as an antiseptic, insecticide, and flame retardant, among other applications.