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Suppose a Business Has Current Assets of $75,000 and Current

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Essay

Suppose a business has current assets of $75,000 and current liabilities of $50,000. The business is trying to obtain a bank loan for $25,000, which would be financed over six months. The terms of the loan agreement specify that the business's current ratio cannot fall below 1.50 at any time. Calculate the current ratio before and after the loan. Do you think the loan will be granted?


Definitions:

Global Distribution

involves the process of making a product or service available for consumption in multiple countries around the world through a systematic logistic network.

Local Needs

The specific requirements and preferences of a community or market, which can vary significantly based on cultural, economic, and geographical factors.

Global Advertising

Global advertising involves planning and executing advertising campaigns that transcend national boundaries, aiming to reach consumers in multiple countries through standardized or slightly adapted marketing messages.

Gross National Income

The total domestic and foreign output claimed by residents of a country, including wages, salaries, and capital gains.

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