A Firm That Holds Cash to Avoid Penalties Associated with the Late

question 19

Multiple Choice

A firm that holds cash to avoid penalties associated with the late payment of bills is demonstrating which type of demand for money?

• A)transactions demand
• B)precautionary demand
• C)speculative demand
• D)present value demand
• E)risk-return demand

---

Definitions:

Attitudes

Mental inclinations manifested through showing a certain level of preference or aversion towards a specific entity.

Values

Fundamental beliefs or principles that guide individuals' behaviors and decision-making, reflecting what is important to them.

Goals

Cognitions that represent outcomes that we strive for in order to meet our needs and desires.

Excitation Transfer Theory

The idea that leftover arousal caused by an initial event can intensify emotional reactions to a second, unrelated event.