A Firm That Wishes to Minimize Risk When Investing Idle

question 47

Multiple Choice

A firm that wishes to minimize risk when investing idle cash would be least likely to buy

• A)commercial paper.
• B)long-term corporate bonds.
• C)certificates of deposit.
• D)Treasury bills of the U.S.government.

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Definitions:

Operating Activities

Business actions that are directly related to the production and delivery of goods and services, which are fundamental to the company’s operations.

Cash Flow Per Share

A measure indicating the amount of cash flow generated by a company on a per-share basis, useful for assessing financial performance and liquidity.

GAAP

A set of widely adhered-to accounting norms and guidelines for financial statements.

EPS Information

Earnings Per Share; a financial metric that represents the portion of a company's profit allocated to each outstanding share of common stock.