If a Firm Has a Cash Cycle of 38 Days

question 66

Multiple Choice

If a firm has a cash cycle of 38 days and an operating cycle of 82 days, what is its payables turnover?

• A) 8.79
• B) 8.30
• C) 9.53
• D) 10.89

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Definitions:

Recession

A period of temporary economic decline during which trade and industrial activity are reduced, generally identified by a fall in GDP in two successive quarters.

Portfolio

A group of various financial instruments such as stocks, bonds, commodities, and cash or cash-like assets, including mutual funds and exchange-traded funds.

Portfolio Diversification

An investment strategy that involves spreading investments across different financial assets to reduce risk.

Diverse Securities

A variety of financial instruments that an investor holds, including stocks, bonds, and commodities, to reduce risk through diversification.