Which One of the Following "Measures" the Average Days of Sales

question 23

Multiple Choice

Which one of the following "measures" the average days of sales committed to the extension of trade credit?

• A) sale-to-cash conversion period
• B) inventory-to-sale conversion period
• C) purchase-to-payment conversion period
• D) cash conversion cycle period

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Definitions:

Complementary Goods

Goods that are typically consumed together, such that the demand for one increases when the price of the other decreases.

Substitute Goods

Goods that can be used in place of each other, where an increase in the price of one leads to an increase in demand for the other.

Independent Goods

Products or services whose demand is not directly related to the demand for other goods; their consumption or purchase does not affect the consumption or purchase of other products.

Quantity Supplied

The amount of a good that producers are willing to sell at a given price over a specified period.