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uid QNAPCOA8010100000041ebc62 ream-00578cksm 1533240343613 0AAA6B04016417ADEF006

ID: 2658244 • Letter: U

Question

uid QNAPCOA8010100000041ebc62 ream-00578cksm 1533240343613 0AAA6B04016417ADEF006C320000 Graded Assignment I Read Chapter 15 1 Back to Assignment Due Thursday 0802.18 at 11:45 PM Attempts: Keep the Highest: /2 3. Current asset financing policies How do firms finance their operating current assets? A firm's asset or capital requirements grow over time and usually exhibit temporal (seasonal) variation. Firms must soive the chalienge of how to finance their assets with a combination of short- and long-term financing. The following graph exhibits this relationship for a particular firm. DOLLARS Asset Requirements Which of the following best characterizes this frmm's policy of financing assets? O Moderate policy O Conservative policy O Aggressive policy Note the shaded region on the preceding graph. Which of the following statements best describes the firm's situation during this time? O The firm has excess capital to invest in cash or marketable securities O The firm must rely on short-term borrowing DELL

Explanation / Answer

First Part: This is a Moderate Policy

Second Part: The firm must rely on short term borrowing