What is involved with proper cash management?
What will be an ideal response?
Answer: Nothing happens without a plan. You need to start off with a budget to determine what your monthly living expenses are and what your savings goals are. Once you determine how much money you need in an emergency fund, then you need to determine the best cash management options available to you. Do you need a checking account and what other options do you need like an ATM card, Debit card and overdraft protection. How much money do you need in your checking account to cover your living expenses and not have any overdraft fees. Next, you need to determine how liquid your savings accounts need to be for the rest of your emergency fund balance. Will an MMDA or a MMMF give you a better return and meet your liquidity needs? Should you give up some liquidity and purchase a CD and for how long? Your cash management goal is to maximize your return while maintaining liquidity and minimizing transaction costs.
You might also like to view...
Use quotation marks to indicate ________________, section, volume, and other parts of a longer document
a. publishers b. copyright information c. a title of an article d. page numbers
Which of the following best explains the reason for the rise in protectionist pressures around the world during the 1980s?
A. The strict GATT bureaucracy in Geneva controlling trade regulations B. The opening up of international markets to cheap products from China C. The fall of the Soviet Union D. The persistent trade deficit in the world's largest economy, the United States E. The economic failure of Japan which hampered the global economy