What Is the Cash Cycle for a Firm with a Receivables

question 22

Multiple Choice

What is the cash cycle for a firm with a receivables period of 40 days,a payables period of 30 days,and an inventory period of 60 days?

• A) 10 days.
• B) 50 days.
• C) 70 days.
• D) 130 days.

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Definitions:

Forecast Error

The difference between the actual demand and the forecasted demand, highlighting inaccuracies in demand planning.

Forecast Error

The variance between what actually happens and the forecasts from prediction models.

Expected Value

Expected value is a concept in probability that calculates the average outcome when the future involves scenarios that may or may not happen.

Moving Average Forecast

A method used in time series analysis to smooth out short-term fluctuations and highlight longer-term trends or cycles.