Asked by Angely Morillo on May 01, 2024
Verified
The CEO of a firm just learned that a small, but highly progressive, competitor is for sale. This is an unexpected opportunity and one that the CEO would like to pursue immediately. The motive behind holding cash for such an event is called the ____ motive.
A) Transaction.
B) Speculative.
C) Reserve.
D) Precautionary.
E) Concentration.
Speculative Motive
This motive describes the intention to hold cash for the purpose of taking advantage of opportunities that may arise, such as purchasing assets expected to increase in value.
- Identify various motives for holding cash and the associated benefits.
Verified Answer
BM
Benedek MolnárMay 05, 2024
Final Answer :
B
Explanation :
The speculative motive refers to holding cash to take advantage of unexpected opportunities, such as acquisitions or investments, that may arise and require immediate financial resources.
Learning Objectives
- Identify various motives for holding cash and the associated benefits.