Which of the Following Is Not an Advantage of Cash

question 2

Multiple Choice

Which of the following is not an advantage of cash concentration?

• A) It creates a large pool of funds for use in making short-term cash investments.
• B) Concentrating the firm's cash in one account improves the tracking and internal control of the firm's cash.
• C) It results in having fewer investment opportunities to choose from.
• D) All of the above are advantages.

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Definitions:

Utility Function

A mathematical representation in economics that describes how the satisfaction or utility a consumer derives varies with consumption of goods or services.

Compensating Variation

An economic concept referring to the amount of additional income required to keep an individual at the same level of utility after a price change.

Price of Earrings

The cost at which earrings are sold, which may vary based on materials, design, and brand.

Income

The amount of money or assets received over a period of time, typically through work, investments, or business operations.