A new project would require an immediate increase in raw materials in the amount $17,000. The firm expects that accounts payable will automatically increase $7,000. How much must the firm expect its investment in net working capital to increase if they accept this project?
A) $17,000
B) $7,000
C) $10,000
D) $24,000

Question

Quizplus · Accepted Answer

Net working capital investment increases by the difference between the increase in raw materials ($17,000) and the automatic increase in accounts payable ($7,000), which is $10,000.

A New Project Would Require an Immediate Increase in Raw