1answer.
Ask question
Login Signup
Ask question
All categories
  • English
  • Mathematics
  • Social Studies
  • Business
  • History
  • Health
  • Geography
  • Biology
  • Physics
  • Chemistry
  • Computers and Technology
  • Arts
  • World Languages
  • Spanish
  • French
  • German
  • Advanced Placement (AP)
  • SAT
  • Medicine
  • Law
  • Engineering
Dmitriy789 [7]
3 years ago
14

At the extreme, a firm that adheres to the conservative approach to finance current assets will finance all of its seasonal need

s with long-term financing alternatives, thereby eliminating the need to use short-term financing. Such a firm will have extra permanent funds during off-peak periods, allowing it to store liquidity in the form of short-term investments during the off-season.a) trueb) false
Business
1 answer:
Cloud [144]3 years ago
4 0

Answer:

The correct answer is A) True

Explanation:

Seasonal needs are short-term in nature. To service them using short-term funds would prove more expensive over the long run.

Long-term finance in most cases have the characteristics of being relatively cheaper than short-term finance.

Chief among the sources of short-term finance are:

  • trade credits,
  • Commercial Bank overdrafts
  • Commercial paper, promissory note, and
  • loans that are secured

Short-term finances are usually less than a year. Whilst long-term finances generally span over one year.

Examples of long term finances are:

  • Equity Capital
  • government debt
  • Bonds
  • Mortgages etc

Interest payable on long term debts are usually single-digit whilst those on short term loans are usually double-digit.

As indicated in the information provided, companies that keep extra "permanent" funds preserve its value by placing it in short term investments

Cheers!

You might be interested in
The rate that a state assigns reflecting a company's stability or instability in employing workers is the:
Nataly [62]
It would be the merit rate wherein a <span>state assigns reflecting a company's stability or instability in employing the worker. In addition, the state most likely allocates points to its employees base on their individual performances in which it is measured with respect to the employee turnovers the have.</span>
5 0
3 years ago
The inflation rate over the past year was 3.8 percent. If an investment had a real return of 6.9 percent, what was the nominal r
Natalka [10]

Answer:

Nominal rate of return= 10.96%

Explanation:

Inflation is the increase in the price level.It erodes the value of money.rise in the price of money

<em>Nominal interest is that quoted for investment or loan transactions. It has not been been adjusted for inflation.  </em>

<em>Real interest rate is the amount of interest in terms of the the quantity of good and services that can be purchased. It is the nominal interest rate adjusted for inflation. </em>

The relationship between inflation, real interest and nominal interest rate is given using the Fishers Effect;

N = ( (1+R) × (1+F)) - 1

N- nominal rate, R-real rate, F- inflation

Nominal rate of return =(1.038)× (1.069) - 1 = 0.109622

Nominal rate of return =  0.109622 × 100 = 10.96%

Nominal rate of return= 10.96%

6 0
3 years ago
Markets always allocate resources in ways that meet ideal economic efficiency.
Virty [35]

Answer:

False. Markets can sometimes fail to reach efficiencies when there are externalities, public goods, monopoly, or serious information asymmetries

Explanation:

Invisible hand (effective allocation of resources in a laissez faire economy) sometimes works because when market function effectively and send correct price as signal of values (to society) to producers.

However, when goods can't be traded on markets (public goods) or its values are not correctly reflected on markets (externalities, information asymmetries) or competition is not ensured (monopoly), markets cannot ensure effective allocation of resources.

5 0
3 years ago
You have been investing $165 a month for the last 12 years. today, your investment account is worth $60,508.29. what is your ave
Tanzania [10]
Given:
Future value, F=60508.29
Monthly payment, A = 165
Compounding period = month
Number of periods, n = 12*12=144
interest per period = i   [ to be found ]

We have the relationship
F=A((1+i)^n-1)/i
but there is no explicit formula for i for given F, A and n.
We need to solve a non-linear equation for the value of i, the monthly interest rate.
One of the ways is to solve it by fixed iteration, i.e. 
1. using the given relation, express i in terms of other parameters.
2. select an initial value of i
3. evaluate i according the equation in step 1 until the value is stable.

Here we will use the relationship to express
i=((60508.29*i)/165+1)^(1/144)-1  [ notice that i is on both sides of = sign ]
using an initial value of i=0.01 (about 1% per month).
Successively, we get
i=((60508.29*0.01)/165+1)^(1/144)-1=0.01075571
i=((60508.29*0.01075571)/165+1)^(1/144)-1=0.011160681, similarly
i=0.0113685
i=0.0114728
i=0.0115246
i=0.0115502
i=0.0115628
i=0.0115690
i=0.0115720
Assuming the above has stablilized, and the APR is 12 time the above value, namely
Annual percentage rate = 0.01157205998210142*12=0.13886=13.89%



6 0
3 years ago
identify the characteristics of a successful workplace culture. select all that apply. employees want to do a good job. employee
PIT_PIT [208]

The characteristics of a successful workplace culture. select all that apply employees like the goals of the organization.

Culture is the character and personality of your organization. it is what makes your business unique and is the sum of its values, traditions, beliefs, interactions, behaviors, and attitudes. Fantastic place of business way of life attracts skills, drives engagement, influences happiness and pleasure, and impacts performance. The character of your business is inspired by everything. Leadership, management, workplace practices, regulations, people, and extra impact culture significantly. The most important mistake groups make is letting their workplace tradition form naturally without first defining what they need it to be.The way your leaders speak and engage with employees, what they talk and emphasize, their vision for the future, what they celebrate and recognize, what they expect, the stories they tell, how they make decisions, the volume to which they're relied on, and the ideals and perceptions they reinforce.

Learn more about Workplace culture here:-

brainly.com/question/24501669

#SPJ4

7 0
1 year ago
Other questions:
  • Darren has the option of investing in either Stock A or Stock B. There is a 45 percent chance that the return on Stock A will be
    8·1 answer
  • Why do Marketers use perceptual maps as a means to display or graph in two dimensions the location of products or brands?
    9·1 answer
  • a project that costs 25500 today will generate cash flows of 8800 per year for seven years. what is the project's payback
    13·1 answer
  • Is hit or miss still popular?????? lol idek.....
    7·1 answer
  • Marketing managers at a cosmetic company wanted to find out how resistant their product is to smudging. They hired a research fi
    7·1 answer
  • James Smith has worked for Perfect Transmission Installers for eight years. His annual base salary is $52,000. For overtime hour
    15·1 answer
  • he demand for good X is given by QXd = 6,000 - (1/2)PX - PY + 9PZ + (1/10)M Research shows that the prices of related goods are
    13·1 answer
  • Why is it important to perform multiple trials in an experiment -- meaning that you include many test individuals or samples?
    13·1 answer
  • A student copies information from a website into a term paper without giving credit. This action is most strongly related to whi
    11·2 answers
  • If the government levies a $1,000 tax per boat on sellers of boats, then the price paid by buyers of boats would a. increase by
    11·1 answer
Add answer
Login
Not registered? Fast signup
Signup
Login Signup
Ask question!