Companies use the finance motive to keep cash on hand for unanticipated required outlays of cash such as unexpected repairs on equipment.

Name: Companies use the finance motive to keep cash on hand for unanticipated required outlays of cash such as unexpected repairs on equipment.
Brand: Quizplus
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Question

Quizplus · Accepted Answer

The finance motive refers to holding cash for planned financial transactions, not unexpected expenses. The precautionary motive is for unexpected outlays.

Companies Use the Finance Motive to Keep Cash on Hand