A.

A.12.25 %

B.15.54 %

C.13.96 %

D.11.40 %

2) Which of the following statements is INCORRECT regarding cash management or liquidity management?

Select one:

A. The goal of liquidity management is to maintain optimal quantity of all types of assets of a firm.

B. Liquidity management is only one particular aspect of current assets policy management.

C. Cash management is related to mechanisms to optimize collection and disbursement of cash.

D. A sensible cash management policy is to hold enough cash on hand and invest excess cash in the marketable securities.

3) What is the effective annual rate (EAR) of interest on a certificate of deposit that has a nominal rate of 5.5% with interest compounded quarterly? Round up to TWO (2) decimal places.

Select one:

A. 5.58%

B. 5.64%

C. 5.50%

D. 5.61%