Which of the following statements is true? (Points : 4) The optimal credit polic

Question

Which of the following statements is true? (Points : 4) The optimal credit policy minimizes the total cost of granting credit. Firms should avoid offering credit at all cost. An increase in a firm's average collection period generally indicates that an increased number of customers are taking advantage of the cash discount. Character, refers to the ability of a firm to meet its credit obligations out its operating cash flows. The optimal credit policy, is the policy that produces the largest amount of sales for a firm.

Explanation / Answer

An increase in a firm's average collection period generally indicates that an increased number of customers are taking advantage of the cash discount. it is true as credit policy get loosened . this will happen

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