Most Large Firms Hold a Cash Balance Greater Than Most

question 23

Multiple Choice

Most large firms hold a cash balance greater than most models imply because:

• A) it is too difficult to estimate the costs of security transactions.
• B) banks are compensated by account balances for payment of services.
• C) corporations have few bank accounts and it is difficult to manage their cash.
• D) cash is costless and need not be managed closely.
• E) None of these.

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Definitions:

Evolutionary Perspective

An approach in psychology that explains human behavior through the lens of adaptation, survival, and natural selection.

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An intense sexual desire or appetite, often distinguished from emotional or romantic love.

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Intense, uncontrolled anger that is often violent and can lead to aggression towards others or oneself.

Neuroscience Perspective

A viewpoint focusing on understanding how the brain and nervous system influence behavior, cognition, emotions, and mental processes.