A Flexible Short-Term Financial Policy Will Tend to Have More

question 41

Multiple Choice

A flexible short-term financial policy will tend to have more of which of the following than a restrictive short-term financial policy will?
I.uncollectable accounts receivable
II.work stoppages for lack of raw materials
III.carrying costs
IV.obsolete or out-of-date inventory

• A)I and II only
• B)III and IV only
• C)II and III only
• D)I, II, and III only
• E)I, III, and IV only

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Definitions:

Price

The amount of money required to purchase a good or service, which can fluctuate based on supply and demand dynamics.

Production Technology

The set of processes, methods, or equipment used by firms in the production of goods or services, which affects productivity and efficiency.

Input Prices

The cost of raw materials and other inputs used in the production of goods and services. Lower input prices can increase profitability for producers.

Production Technology

The methods, processes, and equipment used to produce goods and services.