Explain Why Working Capital Is "Recaptured" When a Project Draws

question 54

Essay

Explain why working capital is "recaptured" when a project draws to a close.

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Definitions:

Payoff Matrix

A table that describes the possible outcomes of different strategies in a strategic situation, helping in decision making.

Best Interest

A principle requiring decisions to be made in the welfare or benefit of those affected, commonly used in legal, financial, and fiduciary contexts.

Commit

To pledge or bind oneself to a certain course or policy; often implies dedicating resources or time.

Nash Equilibrium

A concept within game theory where no player can benefit by changing strategies while the other players keep theirs unchanged.