If Easing a Firm's Credit Policy Lengthens the Collection Period

question 105

Multiple Choice

If easing a firm's credit policy lengthens the collection period and results in a worsening of the aging schedule then why do firms take such actions?

• A) It normally stimulates sales.
• B) To meet competitive pressures.
• C) To increase the firm's deferral period for payables.
• D) All of the above.
• E) Both a and b above.

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Definitions:

Growth Hormone

A peptide hormone that stimulates growth, cell reproduction, and cell regeneration in humans and other animals. It is crucial for human development.

Acromegaly

A disorder in which too much growth hormone is produced in adults.

Gigantism

A condition in which too much growth hormone is produced in childhood, resulting in an abnormally increased stature.

Dwarfism

A condition in which too little growth hormone is produced, resulting in an abnormally small stature.