If a fiRm Has Achieved Its Target Cash Balance the Net

question 83

Multiple Choice

If a firm has achieved its target cash balance the net present value is:

• A)positive because the cash balance is positive.
• B)zero because increasing the cash balance increases the interest cost.
• C)negative because the cash balance has a financing cost.
• D)positive because decreasing the cash decreases the cost of illiquidity.
• E)None of the above.

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Definitions:

Linguistic Relativity

The hypothesis that the language one speaks influences and shapes their cognitive processes and worldview.

Aphasia

A disorder of language, thought to have neurological causes, in which language production and/or language reception are disrupted.

Agnosia

A disorder characterized by the inability to recognize and identify objects, people, or sounds, despite having intact sensory function, usually resulting from brain injury or disease.

Amnesia

A deficit in memory caused by brain damage, disease, or psychological trauma, where the individual is unable to recall past experiences or learn new information.