Identify the factors that influence how much of its assets and organisations likely to hold in the form of cash (including bank balances).

Identify the factors that influence the amount of cash/bank balances an organisation will hold at anyone time. You will need to consider the following questions.  Why do organisations hold some of their assets in the form of cash? What are the costs of holding too much cash? What are the costs of having too little cash? To what extent are the reasons for holding cash similar to those for holding stock?