Although Short-Term Interest Rates Have Historically Averaged Less Than Long-Term

question 39

True/False

Although short-term interest rates have historically averaged less than long-term rates,the heavy use of short-term debt is considered to be an aggressive working capital strategy because of the inherent risks of using short-term financing.

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Definitions:

Marginal Cost

Marginal cost is the change in total cost that arises when the quantity produced is incremented by one unit; it's the cost of producing one more unit of a good.

Opportunity Cost

The loss of potential gain from other alternatives when one option is chosen.

Studying Economics

The academic examination of how societies use resources to produce goods and provide services, including the analysis of production, consumption, and distribution.