Trade Receivables and Inventory Are Some of the Most Liquid

question 40

Essay

Trade receivables and inventory are some of the most liquid assets a firm owns and their market values are typically fairly close to book value.Even so, in the eyes of many lenders, these assets make for inadequate collateral on loans, particularly if the business looking to borrow the money is in a liquidity crisis.Why do you think this is the case?

Understand the concept and impact of eliminating unprofitable segments on net income and fixed expenses.

Comprehend the definitions and applications of cost of capital, hurdle rate, and minimum rate of return.

Analyze the significance and calculation of net present value in investment decisions.

Determine how depreciation affects annual cash inflow calculations.

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Definitions:

Event A

Refers to a specific occurrence or outcome in a statistical experiment or observational study.

Science Courses

Educational classes focused on subjects related to biology, chemistry, physics, and other studies of the natural world.

Discrete Random Variable

A type of random variable that can take on only a finite or countably infinite number of distinct values.

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