Asked by Ken Xiao Xinhua on Jul 27, 2024
Verified
Provide a definition for precautionary motive.
Precautionary Motive
The desire to hold cash or liquid assets to safeguard against future uncertainties and unplanned expenses.
- Identify the various purposes behind holding cash and the way these affect cash management strategies.
Verified Answer
CS
Cameron ShorteJul 27, 2024
Final Answer :
The need to hold cash as a safety margin to act as a financial reserve.
Learning Objectives
- Identify the various purposes behind holding cash and the way these affect cash management strategies.