If a Firm Purchases Materials on Credit and Thus Has

question 163

Multiple Choice

If a firm purchases materials on credit and thus has accounts payable, its cash conversion cycle will be:

• A) longer than its operating cycle
• B) the same length as its operating cycle
• C) shorter than its operating cycle
• D) the same length as its sales turnover cycle

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Definitions:

Economic Disruption

An event or condition that causes significant changes in the performance of the economy, affecting production, consumption, and distribution.

Mediator

An impartial individual or party that intervenes in a dispute or negotiation to help the conflicting parties reach an agreement.

Labor Unions

Organizations formed by workers to protect their rights and interests, typically focusing on issues related to wages, working conditions, and labor laws.

Workforce Unionized

A Workforce Unionized is one where a majority of workers are members of a labor union, which represents their interests in negotiating with employers.