If Demand for a Firm's Products Suddenly Slows Down So

question 138

Multiple Choice

If demand for a firm's products suddenly slows down so that inventory increases while sales decrease, how will the firm's needs for net working capital react?

• A) Net working capital would increase.
• B) Net working capital would decrease.
• C) There would be no change in net working capital.
• D) Net working capital would first decrease, then increase slowly over time.

---

Definitions:

Aggression

Behavior intended to harm or intimidate others, driven by various psychological, environmental, or biological factors.

Heat Waves

Prolonged periods of excessively hot weather, which can have significant health, ecological, and societal impacts.

Temperature

A measure of the warmth or coldness of an environment or object, expressed in degrees.

Causally Related

A connection between two events where one directly impacts or brings about the other.