Which One of the Following Statements Is Correct Concerning the Cash

question 194

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 accounts payable 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 accounts receivable policy will tend to decrease the cash cycle.

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Assessment

Process of gathering information about a person’s symptoms and their possible causes.

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The consistency of a measure or test; its ability to produce the same results under similar conditions.

Generalizability

The extent to which the findings of a study or experiment can be applied to larger populations or different contexts beyond the original subjects or conditions studied.

Validity

The extent to which a test, measurement, or research accurately reflects or assesses the specific concept that it is intended to measure.