Which of the Following Actions Would Be Likely to Shorten

question 62

Multiple Choice

Which of the following actions would be likely to shorten the cash conversion cycle?

• A) Adopt a new manufacturing process that speeds up the conversion of raw materials to finished goods from 20 days to 10 days.
• B) Change the credit terms offered to customers from 3/10,net 30 to 1/10,net 50.
• C) Begin to take discounts on inventory purchases;we buy on terms of 2/10,net 30.
• D) Adopt a new manufacturing process that saves some labor costs but slows down the conversion of raw materials to finished goods from 10 days to 20 days.
• E) Change the credit terms offered to customers from 2/10,net 30 to 1/10,net 60.

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Definitions:

Marketing

The process of promoting, selling, and distributing a product or service, including market research and advertising to reach potential customers.

Advertising

The activity or profession of producing advertisements for commercial products or services to increase awareness and generate sales or interest.

Market Segmentation

The process of dividing a market of potential customers into groups, or segments, based on different characteristics.

Integrated Communications

A comprehensive approach that ensures all forms of communications and messages are carefully linked together across various channels to achieve coherence and maximum impact.