Which Changes Would Increase a Firm's Net Working Capital, All

question 43

Multiple Choice

Which changes would increase a firm's net working capital, all other things remaining constant?

• A) increase in debtors
• B) increase in creditors
• C) decrease in inventories
• D) all of the above

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Definitions:

Interest Rate

The amount charged, expressed as a percentage of the principal, by a lender to a borrower for the use of assets.

Compounded Annually

Interest calculation method where the interest is added to the principal sum at the end of each year, affecting the total interest earned or paid.

Compound Interest

Interest calculated on the initial principal, which also includes all of the accumulated interest from previous periods on a deposit or loan.

Per Year

A synonym for annually, denoting events or measurements taking place once every calendar year.