If a Firm Has a Cash Cycle of 10 Days

question 7

Multiple Choice

If a firm has a cash cycle of 10 days and an operating cycle of 43 days, what is its average payment period?

• A) 10
• B) 33
• C) 43
• D) 53

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Definitions:

Inferior Good

A type of good whose demand decreases as the income of the consumer increases, opposite to what happens with normal goods.

Normal Good

A type of good for which demand increases as the income of the consumer increases.

Normal Good

A good whose demand increases as consumers' income rises, holding all other factors constant.

Students' Incomes

The earnings received by students from part-time jobs, stipends, or scholarships, contributing to their financial support.