If the Receivables Turnover Ratio Rises Significantly,the Increase May Be

question 39

True/False

If the receivables turnover ratio rises significantly,the increase may be a signal that the company is extending credit to high-risk borrowers or allowing an overly generous repayment schedule.

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Definitions:

Marginal Cost

The additional cost resulting from the production of one more unit of a product or service.

Profit Maximizing

The procedure a business uses to ascertain the most profitable price and volume of output.

Monopolist

A single seller in a market, who has significant control over the price and supply of a specific good or service.

Marginal Cost

The increase in total cost resulting from producing one additional unit of a good or service.