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Is Total Net Working Capital or Incremental Net Working Capital

question 60

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Is total net working capital or incremental net working capital more relevant for calculation of free cash flow?


Definitions:

Recessionary Economy

An economy experiencing a significant decline in activity across the economy, lasting longer than a few months, typically visible in real GDP, real income, employment, industrial production, and wholesale-retail sales.

Stock

A form of investment that indicates one has a stake in a company and entails a portion of the company's assets and profits.

Expected Rate of Return

The profit or loss that an investor anticipates on an investment, expressed as a percentage of the investment’s cost.

Recession

A recession is an economic downturn spread across the economy lasting more than a few months, often visible in real GDP, real income, employment, industrial production, and wholesale-retail sales.

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