What factors determine the amount of working capital that a new small business must budget? Suppose you start a business that has a soft opening and sells half of the expected product in the first quarter. You notice towards the end of the quarter that sales pick up near what was expected. How much working capital might you need to budget ahead of time to overcome this obstacle, and how would you obtain this amount of working capital? How might inventory and accounts receivables be leveraged for short-term financing?

Suppose you own a water purification company that sells and installs reverse osmosis systems for homes and businesses. You have a large profitable job lined up two months away, but after buying all of the supplies, you do not have enough capital to sustain the business until that time. What would you do?

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