In General, Which Has the Shorter Maturity and Is More

question 11

Multiple Choice

In general, which has the shorter maturity and is more appropriate for funding short-term inventory needs?

• A) commercial paper
• B) Euro-Medium-Term notes (EMTNs)
• C) the international bond market
• D) all of the above

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Definitions:

Differential Profit

The change in profit resulting from choosing one option over another in decision-making processes.

Fixed Expenses

Costs that do not change with the level of production or sales activities, such as rent, salaries, and insurance.

Variable Factory Overhead

Expenses in a factory that vary with the level of production output, such as utility costs and materials.

Fixed Costs

Expenses that do not change with the level of production or sales over the short term, such as rent or salaries.