Assuming That the Firm Can Either Hold Cash Paying No

question 13

Multiple Choice

Assuming that the firm can either hold cash paying no interest or invest in marketable securities,which of the following might induce the manager to hold higher cash balances?

• A) The cost of borrowing is high relative to interest rates on marketable securities.
• B) Future cash flows are relatively predictable.
• C) The cost of cash balances is relatively high.
• D) Bank interest rates are expected to increase.

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Definitions:

Discrimination

Unfair or prejudicial treatment of individuals or groups based on characteristics such as race, gender, age, or sexual orientation.

Workplace Bullying

It refers to repeated, unreasonable actions of individuals (or a group) directed towards an employee (or a group of employees), which are intended to intimidate, degrade, humiliate, or undermine; or which create a risk to the health or safety of the employee(s).

Surprise Meetings

Unplanned or unannounced meetings, which can be used as a tactic for various purposes, including audits or to catch someone off guard.