If Demand for a Firm's Products Suddenly Increases So That

question 73

Multiple Choice

If demand for a firm's products suddenly increases so that inventory decreases while sales increase, how will the firm's needs for net working capital react?

• A) Net working capital would increase.
• B) Net working capital would decrease.
• C) There would be no change in net working capital.
• D) Net working capital would first decrease, then increase slowly over time.

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Definitions:

Orientation

Familiarises new employees with jobs, co-workers and organisational policies and services.

New Employees

Individuals who have recently joined an organization and are in the process of integrating and understanding their roles within the company.

Organisation

A structured group of people working together to achieve common goals or objectives, typically with defined roles and relationships.

Behaviourally Anchored Rating Scales

A performance appraisal method that rates employees based on specific behaviors related to their job performance.