Having a negative working capital need is generally quite advantageous to the firm since suppliers are,in this case,the most likely providers of financing and the funds they provide are not interest-bearing.Which of the following propositions is not true?
A) A firm should always have a negative Working capital need
B) Firms operating in retailing are likely to show a negative Working capital need
C) A firm that grew by financing its growth mainly through suppliers' credit is more sensitive to a downturn in its sales revenue than a firm that financed its growth through long-term debt.
D) All things being equal,the larger the negative Working capital need,the larger the profit.
Correct Answer:
Verified
Q1: Firm A is based and operates in
Q3: Firms who fear their capital structure indicates
Q4: Two firms are completely identical in all
Q5: How is the working capital calculated?
A) Working
Q6: Balmer Company sells manufactured products for a
Q7: If a firm faces short-term financing difficulties
Q8: Which of the following four types of
Q9: How is the net cash calculated?
A) Bank
Q10: Acme Company sells manufactured products for a
Q11: How does one describe the way a
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