Question: Although short - term interest rates have historically averaged less than long - term rates, the heary use of short - term debt is considered

Although short-term interest rates have historically averaged less than long-term rates, the heary use of short-term debt is considered to be an aggressive current operating asset financing strategy because of the inherent risks of using short-term financing.
True
False
Although short - term interest rates have

Step by Step Solution

There are 3 Steps involved in it

1 Expert Approved Answer
Step: 1 Unlock blur-text-image
Question Has Been Solved by an Expert!

Get step-by-step solutions from verified subject matter experts

Step: 2 Unlock
Step: 3 Unlock

Students Have Also Explored These Related Finance Questions!

Q:

Below are three independent lease scenarios. Payments are made at the beginning of each year. Case 1 Case 2 Case 3 Fair value of equipment $ 160,000 $ 95,000 $ 125,000 Unguaranteed residual value...

Q:

Net working capital is defined as operating current assets minus the difference between current liabilities and notes payable, and any increase in the current ratio automatically indicates that net...

Q:

10 Which of the following statements is CORRECT? Answer Other things held constant, the higher a firm's days sales outstanding (DSO), the better its credit department. If a firm that sells on terms...

Q:

11 Which of the following is NOT commonly regarded as being a credit policy variable? Answer Credit period. Collection policy. Credit standards. Cash discounts. Payments deferral period. .2 points...

Q:

1. Summary balance sheet data for Greener Gardens Co. is shown below (in thousands of dollars). The company is in a highly seasonalbusiness, and the data show its assets and liabilities at peak and...

Q:

Which of the following statements is CORRECT? A. Net working capital is defined as current assets minus the difference between current liabilities and notes payable, and any increase in the current...

Q:

Which of the following statements is CORRECT? Answer Net working capital is defined as current assets minus the sum of payables and accruals, and any increase in the current ratio automatically...

Q:

Which of the following statements is CORRECT? Select one: a. Net working capital is defined as current assets minus the sum of payables and accruals, and any increase in the current ratio...

Q:

Other things held constant, which of the following would tend to reduce the cash conversion cycle? A) Carry a constant amount of receivables as sales decline. B) Place larger orders for raw materials...

Q:

14 Which of the following statements is CORRECT? Answer Net working capital is defined as current assets minus the sum of payables and accruals, and any increase in the current ratio automatically...

Q:

1- The cash conversion cycle (CCC) combines three factors: The inventory conversion period, the average collection period, and the payables deferral period, and its purpose is to show how long a firm...

Q:

Customers arrive at a grocery store checkout at a rate of six per 30 minutes during the hours of 5 p. m. and 7 p. m. during the workweek. Let C be the number of customers arriving at the checkout...

Q:

On the early morning of May 10th, 1996 the two commercial expeditions of Hall and Fischer began their summit bid on Mount Everest. New Zealander Rob Hall, 35 years old, headed the commercial...

Q:

11. Explain the difference between artistic-related intangible assets and contract-related intangible assets.

Q:

Q What is the function of anti-pumping in the circuit breaker?