A Firm May Have a Negative Cash Conversion Cycle If

question 267

Multiple Choice

A firm may have a negative cash conversion cycle if it

• A) carries very little inventory and sells its products for cash.
• B) carries very little inventory and sells its products on credit.
• C) carries high inventory and sells its products for cash.
• D) carries high inventory and sells its products on credit.

---

Definitions:

Subsidized Rate

A reduced interest rate on loans provided by the government or other institutions to support specific groups or activities.

Productivity

The measure of how efficiently goods and services are produced, often evaluated as output per unit of input.

Standard Of Living

The level of wealth, comfort, material goods, and necessities available to a person, family, or group in a society.

Long Run

A period sufficient for all adjustments to be made, including prices, wages, and resource allocations, in response to economic conditions.