A Disadvantage of a Centralized Cash Management System Is That

question 53

True/False

A disadvantage of a centralized cash management system is that managers will not be able to get the lowest average rate available for the firm. Instead, it misses out on the really low borrowing rates.

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Definitions:

Secured Interest

A legal claim or lien on assets or collateral, given to lenders as security for a loan or obligation.

Creditor

A creditor is an entity or person that lends money or extends credit to another party, known as the debtor.

Lien

A legal right or claim against a property as security for payment of a debt or obligation.

Foreclosure

The legal process by which a lender or creditor takes control of a property, evicts the homeowner, and sells the home after the homeowner fails to make full principal and interest payments on a loan.