Why Do Firms Need to Invest in Net Working Capital

question 11

Essay

Why do firms need to invest in net working capital?

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Definitions:

Properties

Characteristics or attributes that define and distinguish substances, objects, or mathematical entities, such as color, shape, size, or numerical value.

Single Attribute

A characteristic or feature of an object or individual that can be isolated for consideration or analysis.

Centration

A cognitive limitation in early childhood, where the focus is on one noticeable aspect of a situation, neglecting other important features.

Decentration

The cognitive ability to consider multiple aspects of a situation simultaneously, rather than being focused on a single viewpoint.