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What is the purpose of the minimum cash balance in an LBO model? A) To maximize the amount of debt financing available by showing lenders a more aggressive investment strategy. B) To ensure the company has sufficient liquidity to cover daily operations and meet its net working capital requirements. C) To inflate the company's total assets on the balance sheet, thereby artificially enhancing the company's perceived market value. D) To reduce the overall risk of the LBO by allocating a larger portion of the investment to low-risk cash assets.
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