The Amount of Cash a Firm Holds to Counter the Uncertainty

question 9

Multiple Choice

The amount of cash a firm holds to counter the uncertainty surrounding its future cash needs is known as a(n) :

• A)speculative balance.
• B)compensating balance.
• C)operating balance.
• D)precautionary balance.

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Definitions:

Internal Management

The process and practice of managing the internal operations and resources of an organization.

Security Analysts

Professionals who evaluate and report on the viability, stability, and profitability of businesses, stocks, and securities.

Specific Objective

A clearly defined and measurable goal that is designed to accomplish a particular task or outcome within a set timeframe.

Comprehensive Income

The net alteration in owners' equity over a reporting period, excluding owner transactions, encompassing all unrealized profits and losses.