The correct answer is option 'B' - Policy.

Explanation:
A firm's policy refers to a set of guidelines or principles that guide its decision-making and operations. It is a framework that helps the firm achieve its objectives and align its actions with its overall strategy.

In this case, the firm has decided to sell its product on a cash basis only. This means that the firm will only accept payment in cash at the time of the transaction, and will not offer any credit or installment options to customers. This decision is a part of the firm's policy.

Policies are established by management and are designed to ensure consistency and efficiency in the firm's operations. They provide a framework for decision-making and help management make informed choices.

Policies can be established in various areas of a firm's operations, including sales, marketing, finance, human resources, and production. They are usually based on the firm's objectives and are intended to support the firm's overall strategy.

In this case, the policy of selling the product on a cash basis only may have been established to ensure prompt and guaranteed payment from customers. By selling on a cash basis, the firm eliminates the risk of non-payment or late payment, which can have a negative impact on its cash flow and financial stability.

Moreover, selling on a cash basis may also help the firm maintain better control over its inventory and manage its working capital more effectively. It allows the firm to receive immediate payment for its products, which can be used to cover operational expenses and invest in growth opportunities.

Overall, the decision to sell the product on a cash basis only is a part of the firm's policy, which guides its operations and helps it achieve its objectives.