Which of the Following Is NOT One of the Baumol

question 92

Multiple Choice

Which of the following is NOT one of the Baumol Model's unrealistic assumptions?

• A)The firm has a constant, perfectly predictable distribution rate for cash.
• B)No cash will come in during the period in question.
• C)No allowance for any safety stock of extra cash to buffer the firm against unexpectedly high demand for cash.
• D)No assumption to start from a replenishment level of cash then decline smoothly to a value of zero.

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