If the Turnover Period for Debtors Is 8

question 59

Multiple Choice

If the turnover period for debtors is 8.1 times per annum, the average number of days it takes to collect cash from debtors is:

• A) 45 days.
• B) 81 days.
• C) 295 days.
• D) 60 days.

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Definitions:

Law of Demand

An economic principle stating that as the price of a product decreases, consumer demand for the product will increase, and vice versa.

Inverse Relationship

A situation where two variables move in opposite directions, meaning as one variable increases, the other decreases.

Willingness

The readiness or propensity of an individual to engage in a particular action or to accept a certain offer.

Law of Demand

A fundamental principle stating that, ceteris paribus, as the price of a good increases, the quantity demanded of that good decreases, and vice versa.