27. Which one of the following statements is correct? A. Cash concentration accounts should improve the efficiency of a firm's cash management. B. A firm with a lock-box system does not need a concentration account. C. Firms generally need multiple concentration accounts. D. Concentration accounts are not needed when a firm's disbursements are all done electronically.

24. Which of the following is the best definition of target cash balance? A. The costs associated with holding too little cash. B. An automated teller machine card used at the point of purchase to avoid the use of cash. As this is not a credit card, money must be available in the user's bank account. C. A chequing account in which a zero balance is maintained by transfers of funds from a master account in an amount only large enough to cover cheques presented. D. A firm's desired cash level as determined by the trade-off between carrying costs and shortage costs.

22. Which of the following is the best definition of zero-balance account? A. The costs associated with holding too little cash. B. A chequing account in which a zero balance is maintained by transfers of funds from a master account in an amount only large enough to cover cheques presented. C. The need to hold cash to satisfy normal disbursement and collection activities associated with a firm's ongoing operations D. A firm's desired cash level as determined by the trade-off between carrying costs and shortage costs.

29. Chrysler Corp. held large sums of cash during the mid-1990s primarily because it would need a large amount of cash in the event of a recession. This is a (n) _____________ for holding cash. A. Precautionary motive. B. Adjustment motive. C. Speculative motive. D. Compensating balances motive.