Which One of the Following Statements Is NOT True

question 46

Multiple Choice

Which one of the following statements is NOT true?

• A) The higher the cash balance, the better the ability of the firm to meet its short-term financial obligations.
• B) The lower the cash balance, the better the ability of the firm to meet its short-term financial obligations.
• C) The level of the cash balance has no bearing on the firm's ability to meet its short-term financial obligations.
• D) None of the above.

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Definitions:

Real Interest Rate

The rate of interest an investor, saver, or lender receives (or expects to receive) after allowing for inflation.

Domestic Investment

The total amount of money invested within a country’s borders by both the private and public sectors.

Net Capital Outflow

In economic terms, it's the net flow of capital, both monetary and physical, out of a country, taking into account investments abroad minus foreign investments domestically.

National Saving

The total of private and public savings in a country, often considered as the sum of household, business, and government savings.