answersLogoWhite

0

Benefit of holding cash is that it can be use in emergancy needs as well as it can be invested in some marketable securities or profitable investment activities while if less or not excess cash maintain then it can be harm the overall operations of business as in case of emergancy or in case of profitable investing opportunities if cash is not available those opportunities may be not avail by company so there are cost and benefits for having no cash or too much cash so it is the duty of financial managers to find the optimal between no cash and too much cash in hand.

User Avatar

Wiki User

11y ago

What else can I help you with?

Related Questions

Benefits and cost of holding Inventories?

what is benefits of holding inventories


What is the main cost of cash?

The main cost of cash includes the opportunity cost associated with not investing that cash in potentially higher-yielding assets. Additionally, holding cash incurs costs such as inflation eroding its value and potential fees for storage or management. There are also logistical costs related to handling, securing, and transporting cash. Overall, while cash provides liquidity, its costs can impact financial efficiency.


What are the benefits of using a global cash card?

The benefits of using a global cash card include: instant payment, convenience, text and email alerts, and it is cost saving. The card is accepted world wide and often is more cost effective when using it as a means for payroll funds.


What are the ramifications of a company having too much cash on hand?

The cash position of a company changes on a relatively frequent basis. During the beginning stages of an economic downturn it may be desirable to hold a larger cash position in case credit markets dry up, as was the case during much of 2008 and 2009. However, when a firm has considerable prospects to deploy cash in an investment, whether it be an investment in property, plant, equipment, acquisitions or some other project, holding cash represents an opportunity cost. The cost to the firm is the advantages and benefits the firm would recognize had they chosen to deploy the cash into one of the previously mentioned investment vehicles. While holding cash reduces risk it also misses the rewards that other investments may have provided.


The shoe-leather cost is?

refers to the cost fof time and effort that people spend triying to counter-act effect of inflation such as holding less cash andto make additional trip to the bank


What are the benefits of selling a used car for cash?

You can buy a better car with the cash


What is the between a cost and a benefit?

Cost is the cash outflow of some activity to achieve higher cash inflow from some activity. Cash outflow is called the cost while cash inflow is called the benefit from specific activity. If cash inflow is morethan cash outflow then it is said that activity has more benefit then it's cost.


Why does high interest rate discourage people from holding their money in cash?

They can earn interest on the cash if it is invested.


Why does a high interest rate discourage people from holding their money in cash?

They can earn interest on the cash if it is invested.


Opportunity cost of holding money?

The opportunity cost of holding money is the nominal interest rate.


What are the benefits of being a WWE wrestler?

the cash


How much does a clarinetist make in a year?

$60,000 / yr Military Bands Placing Cash value on benefits. ( i.e. Health care which would cost you X number of $ )