Which One of the Following Will Decrease the Net Working

question 59

Multiple Choice

Which one of the following will decrease the net working capital of a firm? Assume the current ratio is greater than 1.0.

• A)selling inventory at cost
• B)collecting payment from a customer
• C)paying a payment on a long-term debt
• D)selling a fixed asset for book value
• E)paying a supplier for the purchase of an inventory item

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Definitions:

Labor Market

The marketplace where workers seek employment and employers seek workers, defined by supply and demand for labor.

Marginal Productivity

The additional output that is produced by using one more unit of a factor of production, keeping all other factors constant.

Income Distribution

The way in which a nation’s total income is distributed among its population.

Factor Markets

Markets where services of the factors of production (land, labor, capital) are bought and sold.