Which of the Following Regarding Current Asset Financing Is Correct

question 202

Multiple Choice

Which of the following regarding current asset financing is correct?

• A) In an ideal world, net working capital would be zero.
• B) A flexible policy always implies a short-term cash surplus.
• C) A restrictive policy uses short-term borrowing for permanent asset requirements.
• D) In a compromise policy, short-term borrowing is used, at least partially, in place of maintaining a liquidity reserve.
• E) Most firms do not have seasonal variations in total asset requirements and, as a result, do not need a current assets management policy.

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Definitions:

Complementary Needs

Needs that match; each partner contributes something to the relationship that the other partner needs.

Attraction

The emotional or physical interest one person feels towards another, potentially leading to romantic or sexual relationships.

Relationship Of Circumstance

Interpersonal relationship that exists because of life circumstances (who your family members are, where you work or study, and so on).

Classmate

A fellow member of the same class in school, college, or any educational institution.