The Need to Hold Cash to Take Advantage of Additional

question 359

Multiple Choice

The need to hold cash to take advantage of additional investment opportunities is called the:

• A) Speculative motive.
• B) Precautionary motive.
• C) Transaction motive.
• D) Float motive.
• E) Compensating balances motive.

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Definitions:

Industry Supply Curve

It represents the total quantity of goods or services that producers in an industry are willing and able to supply at various price levels.

Elastic

Describes a situation where the quantity demanded or supplied of a good or service is sensitive to changes in its price.

Intensive Use

Utilization of resources or land to their maximum potential to achieve high output or productivity.

Marginal Cost

The investment needed to manufacture one more unit of a product or service.