Which of the Following Is Least Likely to Be Correct

question 127

Multiple Choice

Which of the following is least likely to be correct for a firm that repeatedly stretches its payables?

• A)the firm may receive more favourable status from suppliers due to its volume of purchases
• B)the firm may reduce its explicit short-term interest expense
• C)the cost of forgone discounts may exceed the cost of bank credit
• D)the firm may be labeled as a credit risk

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Definitions:

Foreign Aid

Financial or non-financial assistance given from one country to another, often to support development or alleviate poverty.

Purchasing Power

The real value of money in terms of the quantity of goods or services that one unit of money can buy.

Disinvestment

The process of selling off a portion of assets or withdrawal of investment capital from stocks, bonds, or businesses, often indicating a strategic or economic decision.

Public Sector

The part of the economy that is controlled by the government, encompassing public services and enterprises, including education, healthcare, and law enforcement.