The Effect of a Change in a Firm's Credit Terms

question 45

Multiple Choice

The effect of a change in a firm's credit terms from "net 30" to "2/10, net 30" on its customers' balance sheets is likely to be ____.

• A) decreased accounts receivable
• B) increased accounts receivable
• C) decreased accounts payable
• D) increased accounts payable

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Definitions:

Actual Behaviours

Actions and conduct exhibited by individuals in real-life settings.

Critical-Incident Technique

A method used to collect direct observations of human behavior that significantly contribute to an aspect of performance.

Recency Bias

The tendency to weigh recent events more heavily than earlier events when making decisions or evaluations.

Evaluations

The systematic assessment of the performance, value, or quality of an individual, organization, or program.