A New Project Requires an Increase in Both Current Assets

question 13

Multiple Choice

A new project requires an increase in both current assets and current liabilities of $125,000 each.What is the overall impact on net working capital investment?

• A) An increase of zero
• B) An increase of $125,000
• C) An increase of $250,000
• D) An increase of $62,500, when averaged over the life of the project

---

Definitions:

Pulse Scheduling

A marketing strategy that alternates periods of advertising intensity with periods of no advertising.

Theater Test

An experimental marketing technique where new products, ads, or services are presented to an audience in a controlled environment to gauge reactions.

Test Commercials

Advertisements that are tested in limited markets or demographics to evaluate their effectiveness before wider release.

Starch Test

A method used in various industries to detect the presence of starch by turning an iodine solution blue-black upon contact. In another context, it assesses the effectiveness of print advertisements based on recall and recognition.