Which one of the following will tend to increase the length of time a company wi

Question

Which one of the following will tend to increase the length of time a company will extend credit? Select one: a. Increase in product standardization b. Decrease in consumer demand c. Decrease in product cost d. Increase in credit risk e. Decrease in collateral value

Question 10 Laurie's Ice Rink keeps an extra $1,500 in its checking account simply in case an emergency arises. Which type of motive for holding cash does this represent? Select one: a. Precautionary b. Float requirement c. Availability d. Transaction e. Speculative

Explanation / Answer

Which one of the following will tend to increase the length of time a company will extend credit? Select one: a. Increase in product standardization b. Decrease in consumer demand c. Decrease in product cost d. Increase in credit risk e. Decrease in collateral value

It “signals” potential customers that the product is of high quality because time is given to return the product if it is deemed unsuitable or defective

Laurie's Ice Rink keeps an extra $1,500 in its checking account simply in case an emergency arises. Which type of motive for holding cash does this represent?

a. Precautionary motive...He is taking precaution of keeping extra cash which may required in case of emergency

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