Which of the Following Statements Is False

question 143

Multiple Choice

Which of the following statements is false?

• A) In addition to sales price,product quality,and advertising,credit policy is a major controllable variable which can affect product demand.
• B) Sharp seasonal swings in sales and fast growth are two reasons why a firm's aging schedule and DSO may show high variability.
• C) Changes in a firm's collection policy can affect sales and working capital but will not affect additional funds needed.
• D) Cash discounts can be used to influence a firm's sales volume and its DSO.
• E) Firms which offer credit terms with a cash discount usually seek two benefits: (1)to attract more customers,and (2)to reduce their DSO.

---

Definitions:

Economy of Scale

The cost advantage that arises with increased output of a product, where the average cost per unit falls as production scales up.

Sound-on-film

A technology that synchronizes audio with moving pictures, allowing for sound to be recorded onto the same film strip as the image.

Movietone

Movietone refers to an early sound film system that combined motion pictures with synchronized recorded sound.

Three-strip Technicolor

Three-strip Technicolor is a color film process that uses three strips of film to capture the red, green, and blue color components, introduced in the 1930s to create vivid color movies.