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Some researchers challenge findings based on use of the Strange Situation because
Net Working Capital
The difference between a company's current assets and current liabilities, indicating its short-term financial health.
Current Assets
Assets that are expected to be converted into cash, sold, or consumed within a year's time, such as cash, inventory, and receivables.
Current Liabilities
Short-term financial obligations that a company owes and is expected to pay within one year or its operational cycle, whichever is longer.
Compensating Balance
A minimum bank account balance that a borrower must maintain as a condition for obtaining a loan.
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