RB Enterprises (RBE) received an unexpected phone call from a competitor offering all of its assets to RBE at a bargain basement price. While RBE had not anticipated purchasing these assets, the opportunity was too good to pass up. This illustrates which one of the following needs to hold cash?

Question

Quizplus · Accepted Answer

The speculative motive for holding cash refers to the desire to take advantage of unexpected opportunities, such as purchasing assets at a bargain price. This is exactly what RBE is doing by considering the purchase of a competitor's assets at a low price.

RB Enterprises (RBE) Received an Unexpected Phone Call from a Competitor