Firms hold cash,in part,to satisfy compensating balance requirements.Compensating balances are cash balances held at:
A) the firm in excess of its transactions needs.
B) the firm that are below that of its transactions needs.
C) the firm in excess of its cash inflows.
D) commercial banks to pay implicitly for bank services.
E) commercial banks as emergency funds.
Correct Answer:
Verified
Q3: Firms hold cash to satisfy the transaction
Q4: The fastest but most expensive way for
Q5: Firms would need to hold zero cash
Q6: All the following can create disbursement float
Q7: By getting closer to the source of
Q9: Average daily float can be calculated as:
A)Average
Q10: Which one of these probably has reduced
Q11: Determining the appropriate cash balance involves assessing
Q12: Net collection float means the:
A)book balance is
Q13: Most large firms hold a larger cash
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