A Negative Correlation Between Degree of Wealth and Likelihood of Suffering

question 140

Multiple Choice

A negative correlation between degree of wealth and likelihood of suffering from a psychological disorder would indicate that

• A) poverty makes people vulnerable to psychological disorders.
• B) poor people are more likely to have a psychological disorder than are wealthy people.
• C) psychological disorders usually prevent people from accumulating wealth.
• D) all of these statements are correct.

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Definitions:

Transaction Motive

The need to hold cash for the purpose of conducting day-to-day business operations.

Float Management

The practice of managing the time difference between the writing of a check and its clearing at the bank, aiming to optimize the use of available funds.

Small Firm

A business with a limited number of employees and revenue, often defined within specific legal frameworks based on the industry.

Sources of Float

Sources of float include the time difference between when a payment is initiated and when it is actually cleared and becomes available in a company's bank account, affecting the management of cash flow.