A Minimum Checking Account Balance That a Firm Must Maintain

question 98

Multiple Choice

A minimum checking account balance that a firm must maintain with bank to help offset the costs and services such as check clearing and cash management advice is called a balance.

• A)transactions
• B)compensating
• C)precautionary
• D)speculative
• E)convertible

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Definitions:

Rational Self-Interest

The principle that individuals tend to make decisions that maximize their own utility or benefit.

Collude

To conspire or work together secretly, especially in order to cheat or deceive others.

Dutch Auction

A type of auction where the auctioneer starts with a high asking price which is lowered until some participant is willing to accept the auctioneer’s price, or a predetermined minimum price is reached.

Sealed-Bid Auction

A type of auction where all bidders simultaneously submit sealed bids without knowing the bids of other participants.