Use the Following Statements to Answer This Question

question 29

Multiple Choice

Use the following statements to answer this question:
I.A high receivables turnover is a good credit strategy that allows firms to lower working capital requirements
II.Trade credit terms are financing tools to the supplier

• A)I and II are correct.
• B)I and II are incorrect.
• C)I is correct and II is incorrect.
• D)I is incorrect and II is correct.

---

Definitions:

Lawn Mowing

The action or process of cutting the grass in a lawn to maintain its appearance and health.

Shut Down

A short-term decision by a firm to cease production due to market conditions, typically because the market price is below the minimum of average variable costs.

Economic Profits

The difference between total revenue and total costs, including both explicit and implicit costs, indicating profitability beyond normal returns.

Long-run

A period of time in which all factors of production and costs are variable, allowing companies to adjust to market changes completely.