Which of the following statements about total capital requirement is least likely to be correct for a profitable firm?

Question

Quizplus · Accepted Answer

Total capital requirement is unlikely to remain constant over time for a profitable firm. As the business grows, investment opportunities may arise that require additional capital expenditures. Additionally, changes in economic conditions or industry trends may also necessitate an increase in capital requirements. Seasonal variations may also impact the total capital requirement, as some businesses may experience higher demand during certain times of the year. Finally, it is common for a portion of working capital to be considered permanent, as it is required to sustain ongoing operations.

Which of the Following Statements About Total Capital Requirement Is