Working Capital Management Flashcards
1
Q
A motive of a firm to hold cash to facilitate normal transactions of the business
A
Transaction motive
2
Q
A motive of a firm to hold cash beyond the normal operating requirement to provide for buffer against contingencies
A
Precautionary motive
3
Q
A motive of a firm to hold cash to avail of profit-making opportunities
A
Speculative motive
4
Q
A motive of a firm to hold cash as required by contracts or covenants
A
Contractual motive
5
Q
A
