There Is a Technological Advance in the Production of Digital

question 107

Multiple Choice

There is a technological advance in the production of digital watches. This will cause:

• A) demand to increase.
• B) supply to increase.
• C) the price to increase.
• D) supply to decrease.

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Definitions:

Receivables Turnover

A financial metric that measures how efficiently a company collects cash from its credit sales by calculating the number of times receivables are turned over during a period.

Payables Turnover

A financial ratio that measures how fast a company pays its suppliers, calculated as the cost of sales divided by average accounts payable.

Cash Cycle

The duration of time it takes for a business to convert its investments in inventory and other resources into cash flows from sales.

Receivables Period

The average number of days required for a company to receive payments owed by its customers for goods or services rendered.