You Should Not Make Investments After You Have Sufficient Liquidity

question 40

True/False

You should not make investments after you have sufficient liquidity.

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Definitions:

Net 45

A payment term indicating that full payment is expected within 45 days from the invoice date.

Economic Order Quantity

A formula used to determine the most efficient quantity to order to minimize the costs associated with buying, holding and stockout.

Carrying Costs

Expenses associated with holding or maintaining an inventory, including storage, insurance, and taxes.

Fixed Costs

Expenses that do not change in total regardless of the level of production or sales activity.