A Firm with a Flexible Short-Term Financial Policy Will

question 46

Multiple Choice

A firm with a flexible short-term financial policy will:

• A) maintain a low balance in accounts receivables.
• B) only have minimal amounts, if any, invested in marketable securities.
• C) invest heavily in inventory.
• D) have low cash balances.
• E) have tight restrictions on granting credit to customers.

---

Definitions:

Industrial Equipment

This category involves machinery and tools used in manufacturing processes, ranging from small tools to large machinery for heavy industries, playing a crucial role in industrial operations.

Recession

A period of temporary economic decline during which trade and industrial activity are reduced, typically identified by a fall in GDP in two successive quarters.

Automobile Industry

A sector of the economy focused on the manufacture and sales of vehicles, including cars, trucks, and motorcycles.

Medical Services

Professional care or treatment provided by licensed healthcare providers, such as doctors and nurses, to maintain or improve an individual's health.