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Compensating balances: A. are ordered monthly (or quarterly) following forecasts based on cash budget analysis to compensate for shortfalls B. require a commitment fee C.
Compensating balances:
A. are ordered monthly (or quarterly) following forecasts based on cash budget analysis to compensate for shortfalls
B. require a commitment fee
C. earn high rates of interest for the firm
D. are used to finance inventories
E. increase the effective interest earned by banks on credit lines
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