Which One of the Following Is a Working Capital Decision

question 22

Multiple Choice

Which one of the following is a working capital decision?

• A) How should the firm raise additional capital to fund its expansion?
• B) What debt-equity ratio is best suited to our firm?
• C) What is the cost of debt financing?
• D) Which type of debt is best suited to finance our inventory?
• E) How much cash should the firm keep in reserve?

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Definitions:

Innate

Inborn or natural characteristics, abilities, or qualities not influenced by learning or experience.

Learned

Acquired knowledge or skills through study, experience, or being taught.

Behavioral Component

Aspects of behavior associated with emotional responses, including observable actions and reactions in response to stimuli or situations.

Recycling

The process of converting waste materials into new products to prevent waste of potentially useful materials and reduce consumption of fresh raw materials.