The Three Main Working Capital Strategies Discussed in the Text

question 177

Multiple Choice

The three main working capital strategies discussed in the text, aggressive, conservative, and moderate, differ primarily in the

• A)Relative amount of short-term debt used.
• B)Minimum level of permanent current assets.
• C)Relative amount of long-term debt versus equity used to finance permanent current assets.
• D)Average level of temporary current assets.
• E)Amount of trade credit used.

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Definitions:

Forecasted Sales

An estimate of the amount of revenue that a company expects to generate from the sale of goods or services in a future period.