A Firm Which Uses the Aggressive Financing Strategy

Working capital financing involves improving cash flow to allow for business opportunities. LG 2 Learning Outcome.

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The most likely consequence of this action is ________.

. The most likely consequence of this action is aa decrease in the current ratio. A it increases return and increases risk B it increases return and decreases risk C it decreases return and increases risk D it decreases return and decreases risk Answer. Managers who are risk-takers are more comfortable with an aggressive financing strategy.

A a decrease in the current ratio. The firm will finance the purchase with a long-term loan. At the operating breakeven point ________ equals zero.

D an increase in long-term debt. As per this financing strategy the organization uses its short-term funds to finance a part of its permanent assets. The aggressive approach is a high-risk strategy of working capital financing wherein short-term finances are utilized to finance the temporary working capital and a reasonable part of the permanent working capital.

Question 9 A firm which uses the aggressive financing strategy plans to purchase a major fixed asset financed with a loan. If the firm uses aggressive financing strategy the firm is said to reduce risk and reduce return. 99 A firm which uses the aggressive financing strategy plans to purchase raw materials in large quantities to take price discounts.

B an increase in net working capital. Problems show your work 1 Point 11. Asked Dec 21 2018 in Business by Photographer.

An increase in long-term debt. The most likely consequence of this action is A a decrease in the current ratio. A firm which uses the aggressive financing strategy plans to purchase a major fixed asset financed with a loan.

28A firm which uses the aggressive financing strategy plans to purchase raw materials in large quantities to take price discounts. Whether adopting a conservative hedging or aggressive working capital management strategy your business requires injections of cash to keep expanding. If a firm uses an aggressive financing strategy 9.

If the firm uses an aggressive financing strategy. 3 Strategies of Working Capital Financing. The firm will finance the purchase with a loan.

There are three strategies or approaches or methods of working capital financing Maturity Matching Hedging Conservative and Aggressive. AnswerD 90A firm which uses the aggressive financing strategy plans to purchase raw materials in large quantities to take price discounts. In this approach to financing the levels of inventory accounts receivables and bank balances are just sufficient with no cushion for.

The most likely consequence of this action is A a decrease in the current ratio. The most likely consequence of this action is 1. It is the most profitable method of managing working capital but it comes with the most risk.

A a decrease in the current ratio B an increase in net working capital C a decrease in the risk of insolvency D an increase in long-term debt Answer. An aggressive financing strategy is a financing strategy under which a company funds its seasonal requirements with short-term debts and its permanent requirement with long-term debt. A decrease in the risk of technical insolvency.

C a decrease in the risk of technical insolvency. 95 If a firm uses an aggressive financing strategy _____. The hedging approach is an ideal method of financing with moderate risk and profitability.

The amount of time that elapses from the point when the firm makes an outlay to purchase raw materials to the pint when cash is collected from the sale of the finished good. B an increase in net working capital. A firm that follows an aggressive current asset financing approach uses primarily short-term credit and thus is more exposed to an unexpected increase in interest rates than is a firm that uses long-term capital and thus follows a conservative financing policy.

The most difficult set of accounts to predict are _____. The aggressive funding strategy is a strategy by which a firm finances all projected funds requirements with longterm funds and uses shortterm financing only for emergencies or unexpected outflows. B an increase in net working capital.

Ban increase in net working capital. The lower risk of a conservative strategy also results in reduced profits because of the higher interest rate costs of long-term debt. C an undetermined change in the current ratio.

Funding Requirements of the Cash Conversion Cycle Learning Obj. The most likely consequence of this action is a a decrease in the current ratio. A a decrease in the current ratio.

The most likely consequence of this action is ________. B an increase in net working capital. 99 A firm which uses the aggressive financing strategy plans to purchase a major fixed asset financed with a loan.

An increase in net working capital. Credit Analysis _____ is the procedure for evaluating mercantile credit applicants. 90 A firm which uses the aggressive financing strategy plans to purchase raw materials in large quantities to take price discounts.

The other two are extreme strategies. The firm will finance the purchase with a loan. The two major sources of short-term financing are.

This is a very risky approach as there are chances that the organization might have a hard time dealing with its short-term obligations. Its heavy reliance on short-term financing makes it riskier because of interest rate swings and possible difficulties in obtaining short-term quickly when seasonal peaks occur. 89 A firm which uses the aggressive financing strategy plans to purchase a major fixed asset financed with a loan.

Xiao Li wishes to accumulate 50000 by the end of 10 years by making equal annual end-of-year deposits over the next 10 years. The firm will finance the purchase with a loan. The most likely consequence of this action is _____.

D an increase in long-term debt. It increases return and increases risk. If a firm uses an aggressive financing strategy it _____ return and _____ risk.

A firm which uses the aggressive financing strategy plans to purchase a major fixed asset financed with a loan. A decrease in the current ratio. Small business owners face many options when it comes to financing their businesses.

The most likely consequence of this action is. C a decrease in the risk of technical insolvency.

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