In an Investment Policy Statement, the Objectives of an Investor

question 55

Multiple Choice

In an investment policy statement, the objectives of an investor are expressed in terms of

• A) risk and return.
• B) risk.
• C) return.
• D) time horizon.
• E) liquidity needs.

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Definitions:

Prompt Payment

A term describing the timely processing of payment to a vendor or creditor, often governed by contractual terms or regulations to ensure payments are made within an agreed-upon timeframe.

Accounts Receivable Turnover

A financial metric used to measure how efficiently a company collects revenue from its credit sales, calculated by dividing net credit sales by the average accounts receivable.

Average Collection Period

The mean period required for a company to get payment from its clients.

Finance Charges

Fees representing the cost of credit or the cost of borrowing, including interest and transaction fees.