A Short-Term Financial Decision Based on an MNC Management's Expectation

question 63

Multiple Choice

A short-term financial decision based on an MNC management's expectation that the local foreigncurrency will appreciate may be

• A) decreasing local notes receivable and decreasing accruals.
• B) increasing local customers' accounts receivable and increasing local notes payable.
• C) increasing local inventories and increasing local notes payable.
• D) increasing local accounts receivable and decreasing local accounts payable.

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Definitions:

Firm

A business enterprise or establishment, often involved in the production and sale of goods or services.

Re-Order Point

A predetermined inventory level at which new stock should be ordered to replenish supplies before reaching a critically low or stock-out situation.

Demand

The quantity of a good or service that consumers are willing and able to purchase at various prices during a given time period.