One Way a Firm Can Reduce the Amount of Cash

question 136

Multiple Choice

One way a firm can reduce the amount of cash it needs in any month is to ________.

• A) slow down the payment of receivables
• B) delay the payment of wages
• C) accrue taxes
• D) speed up payment of accounts payable

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Definitions:

Short-Run Profits

Profits earned by a firm in a period where at least one factor of production is fixed.

Perfectly Competitive

Refers to a market structure where many firms sell an identical product, and no single firm can influence the market price due to its small market share.

Break Even

The point at which total costs and total revenue are equal, resulting in no net loss or gain for a business.

Short Run

A period in economics during which some factors of production are fixed, making it impossible to change the level of output quickly.