Weather Would Be a Significant Factor in Determining a Business

question 93

Multiple Choice

Weather would be a significant factor in determining a business location and demand for all but which of these products?

• A) Air conditioners
• B) Outdoor swimming pools
• C) consumer yard irrigation systems
• D) mattresses

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Definitions:

Net Present Value

A valuation method that calculates the present value of expected future cash flows minus initial investment, used to assess investment opportunities.

Lockbox System

A service provided by banks to companies for the receipt of payment from customers, under which the payments are directed to a special post office box instead of the company’s corporate address.

Money Market Securities

Short-term financial instruments, typically liquid and with high credit quality, traded in the money market involving assets like treasury bills, commercial paper, and certificates of deposit.

Collection Time

Refers to the average period it takes for a business to receive payments owed by its customers after a sale has been made.