Which of the Following Would NOT Fall Under the Heading

question 237

Multiple Choice

Which of the following would NOT fall under the heading of short-term financial planning?

• A) A firm is considering increasing inventory to increase responsiveness to its customers.
• B) A firm is considering steps to shorten its collection period.
• C) A firm is considering making it easier for customers to purchase on credit.
• D) A firm is considering offering cash discounts to customers if they pay within 10 days.
• E) A firm is considering whether to pay a stock dividend or not.

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Definitions:

Reference Pricing

The practice of setting a price point for a product or service based on the cost of comparable alternatives in the market.

Original Price

The initial selling price of a product or service before any discounts or promotions are applied.

Competitive Price Environment

A market condition in which multiple companies offer similar products or services, often leading to pricing strategies aimed at attracting customers while maintaining profitability.

Price-Setting Process

The method used by businesses to determine the selling price of their products or services, taking into account costs, competition, target market, and profit margins.