When Using the Bardahl Formula, an Increase in Annual Credit

question 44

Multiple Choice

When using the Bardahl formula, an increase in annual credit sales (while holding the average accounts receivable balance constant) has which of the following effects on the working capital requirements?

• A)increase
• B)decrease
• C)no effect
• D)increase, decrease, or no effect, depending on other factors

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Definitions:

Verbal Persuasion

The act of influencing or convincing others through spoken words, using logic, emotion, or authority.

Emotional Arousal

A condition where an individual experiences intense feelings or heightened emotional states, which can impact behavior and cognition.

Bandura

Refers to Albert Bandura, a psychologist known for his work on social learning theory, which emphasizes the role of observational learning, imitation, and modeling in behavior.

MBO (Management By Objectives)

A strategic management model that aims to improve the performance of an organization by clearly defining objectives that are agreed to by both management and employees.