If a Firm Takes Actions That Reduce Its Days Sales

question 95

True/False

If a firm takes actions that reduce its days sales outstanding (DSO),then,other things held constant,this will lengthen its cash conversion cycle (CCC)and cause a deterioration in its cash position.

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Definitions:

Long-Run Equilibrium

A state in which all factors of production and outputs are optimally allocated, and economic forces are balanced, leading to no further incentive for change.

Economic Profit

A measure of performance that includes both the tangible and intangible costs associated with doing business, providing a more comprehensive view than traditional profit metrics.

Restaurant Market

Refers to the commercial space or sector dedicated to establishments offering food and beverage services to customers.

Gas Stations

Gas Stations are retail facilities that sell fuel and engine lubricants for motor vehicles, often offering additional services or goods.