A Negative Feature of Defining Investment by EXCLUDING the Portion

question 62

Multiple Choice

A negative feature of defining investment by EXCLUDING the portion of total assets employed that are financed by short-term creditors is that:

• A)current liabilities are sometimes difficult to define
• B)short-term debt is always more expensive to finance than long-term debt
• C)this method encourages managers to use an excessive amount of short-term debt
• D)this method encourages managers to use an excessive amount of long-term debt

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Definitions:

Specialists

Professionals or organisms with a focus on a particular area of study or skill, often resulting in increased efficiency or knowledge in that area.

Population Cycle

The fluctuation in population numbers over a period of time due to factors like food availability, predation, and disease.

Population Behaviours

The collective actions and patterns of behaviour exhibited by individuals within a population, influencing and being influenced by social and environmental factors.

Density-dependent

Factors whose effects on the size or growth of the population vary with the population density.