Which of the Following Is NOT a Fundamental Factor Ignored

question 120

Multiple Choice

Which of the following is NOT a fundamental factor ignored by the target cash balance models?

• A) Firms have the option to borrow short-term to meet unexpected demands for cash.
• B) The costs and delays of trading securities have fallen dramatically since the advent of the Internet.
• C) Many large firms habitually use all or the majority of their available cash to purchase overnight securities.
• D) Models take into account that many firms must keep compensating balances in their deposit accounts as part of borrowing agreements with their banks.

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Definitions:

Individual Fitness

In biology, it refers to an organism's ability to pass its genes to the next generation, often measured by reproductive success.

Situational Constraints

External factors present in the environment that limit or shape an individual's behavior or choices.

Survival

Living longer.

Theory of Evolution

A scientific explanation for the diversity of life on Earth, proposing that species change over time through processes such as natural selection.