The Traditional Argument for Maintaining Small Cash Balances Says That

The traditional argument for maintaining small cash balances says that:

A) cash balances earn below market interest rates or no interest and should be kept to a minimum.
B) the interest that is lost on cash balances is more than offset by the convenience of having cash readily available.
C) cash balances should be held in multiple banks to offset the risk of any one bank failing.
D) the amount of a firm's cash balance is inversely related to the firm's sales volume.

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