Under a Conservative Approach to Working Capital Management, a Firm

question 62

Multiple Choice

Under a conservative approach to working capital management, a firm tends to hold a relatively ____ proportion of its total assets in the form of current assets.

• A) small
• B) constant
• C) stable
• D) large

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Definitions:

Checking Account

A bank account that allows for the deposit and withdrawal of funds and is typically used for day-to-day transactions.

Pays Bills Online

The process of using internet banking or payment platforms to settle invoices or bills.

Compounded Daily

Describes the method by which interest is calculated on an investment or loan with the earned interest being added to the principal daily for future interest calculations.

Annual Percentage Yield

The real rate of return earned on an investment, taking into account the effect of compounding interest.