Which of the Following Are the Three Reasons That Firms

question 31

Multiple Choice

Which of the following are the three reasons that firms need short-term financing?

• A) seasonalities, permanent working capital, and positive cash flow shocks
• B) seasonalities, funding risk, and permanent working capital
• C) negative cash flow shocks, positive cash flow shocks, and seasonalities
• D) permanent working capital, negative cash flow shocks, and funding risk

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Definitions:

Metal Ores

Naturally occurring solid materials from which metals can be extracted profitably.

Research And Development

Research And Development (R&D) involves investigative activities that a business conducts to improve existing products and procedures or to lead to the development of new products and procedures.

Operating Expenses

The costs associated with running the day-to-day operations of a business, such as rent, utilities, and payroll.

Accumulated Depreciation

The total amount of depreciation expense that has been recorded against a fixed asset over its useful life, reducing its book value.