Firms Pay a Low Interest Rate on Spontaneous Liabilities So

question 38

True/False

Firms pay a low interest rate on spontaneous liabilities so these funds are its cheapest source of capital.Consequently, the firm should make arrangements with its suppliers to use as much of this credit as possible.

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Definitions:

Corporate Manager

An individual responsible for leading, directing, and overseeing the operations and strategy of a corporation.

Insider Trading

Using inside information to either cheat the corporation or take unfair advantage of corporate outsiders.

Material

The substance or substances from which a thing is or can be made, often used in contexts involving physical objects or the fabric of physical, tangible items.

Nonpublic

Information or entities not available or accessible to the general population, often restricted due to privacy or confidentiality considerations.