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jkim3464 jkim3464
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4 months ago
Which of the following scenarios is an example of the precautionary motive to hold cash?

▸ A small business pays a cash dividend to its owner because she's not sure she will have enough funds to pay for Christmas gifts for her family.

▸ A bank holds cash on deposit for its customers.

▸ A car dealership holds cash to pay its utility bill.

▸ A retailer holds a reserve of cash in case customers return products for a cash refund.
Textbook 
Corporate Finance

Corporate Finance


Edition: 5th
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itashiaitashia
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4 months ago
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jkim3464 Author
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4 months ago
Helped a lot
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IvanaVR
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Smart ... Thanks!
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