Which of the Following Statements Is Correct

question 3

Multiple Choice

Which of the following statements is correct?

• A)A firm has a greater likelihood of needing an unexpected loan when its cash flows are relatively constant over time.
• B)The cost of borrowing affects the target cash balance of a firm.
• C)Management's desire to maintain a low cash balance has no effect on the borrowing needs of a firm.
• D)The target cash balance increases as the interest rate rises.
• E)The target cash balance decreases as the order costs increase.

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Definitions:

Expressive Role

A social role that focuses on emotional, supportive, and nurturing behavior, typically associated with maintaining relationships and the social cohesion of groups.

Immediate Development

pertains to rapid progress or improvement in conditions or capabilities, occurring without significant delay.

Economic Union

refers to an agreement between countries that allows for the free movement of goods, services, and people, and coordinates economic policies.

Socially Approved

Actions or behaviors that are accepted and encouraged by the majority within a society or social group.