Which One of the Following Statements Is Correct Concerning the Cash

question 58

Multiple Choice

Which one of the following statements is correct concerning the cash cycle?

• A)The longer the cash cycle, the more likely a firm will need external financing.
• B)Increasing the trade payabless period increases the cash cycle.
• C)A positive cash cycle is preferable to a negative cash cycle.
• D)The cash cycle can exceed the operating cycle if the payables period is equal to zero.
• E)Adopting a more liberal trade receivables policy will tend to decrease the cash cycle.

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