An Acceleration in the Collection of Receivables Will Tend to Cause

question 13

Multiple Choice

An acceleration in the collection of receivables will tend to cause the accounts receivable turnover to:

• A)decrease.
• B)remain the same.
• C)neither increase nor decrease.
• D)increase.

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Definitions:

Autonomous Consumption

The level of consumption that occurs when income is zero, representing basic necessities that individuals will purchase regardless of their income.

APC

It is defined as the proportion of income that goes into consumption expenses, termed as the Average Propensity to Consume.

Disposable Income

Fiscal assets at households' disposal for spending and saving after income taxes have been subtracted.

Consumption

Households' utilization of both products and services.