Question

Borrowing money is required whenever Blank______.



Multiple select question.

the cash excess is less than the minimum required cash balance


the cash excess equals the minimum required cash balance


there is a cash deficiency


the cash excess is greater than the minimum required cash balance

Answer 1

Borrowing money is required whenever:

- **there is a cash deficiency**

This option highlights that borrowing is necessary when there is not enough cash available to meet obligations.

The other options do not accurately reflect the need to borrow money:
- **the cash excess is less than the minimum required cash balance** implies that more cash is needed, but there is no deficiency yet.
- **the cash excess equals the minimum required cash balance** indicates that all cash needs are being met without borrowing.
- **the cash excess is greater than the minimum required cash balance** suggests that there is surplus cash available.

Thus, the only correct option indicating a need for borrowing is the cash deficiency.