Which Firms Can Maintain a Higher Portion of Their Liquidity

question 46

Multiple Choice

Which firms can maintain a higher portion of their liquidity in marketable securities and less in cash?

• A)Firms that have well-developed cash management systems and more predictable cash flows.
• B)Firms that have more cash than they need.
• C)Firms that have expertise in securities trading.
• D)Firms that have volatile cash flows.

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Definitions:

Standardized Forms

Pre-designed documents with uniform format and content used across various transactions or processes for efficiency and consistency.

Materially Alter

In contract law, it refers to a change that significantly affects the rights or obligations of the parties involved.

Acceptance

The act of agreeing to the terms of an offer, forming the basis of a contract.

Offer

A proposal presented by one party to another with the intention of entering into a legally binding agreement.