Question: Match the following with the items below: 1. temporary current assets Long-term interest rates reflect the average of expected short-term rates over the life of

Match the following with the items below:

1. "temporary" current assets

Long-term interest rates reflect the average of expected short-term rates over the life of the long-term security.

____

2. self-liquidating assets

The financing and management of the current assets of the firm.

____

3. level production

Assets that are assumed to be long term in nature.

____

4. working capital management

Current assets that will not be reduced or converted to cash within the normal operating cycle of the firm.

____

5. expected value

Depicts in graphical form the relationship between interest rates and maturities for securities of equal risk.

____

6. trade credit

Financing provided by sellers or suppliers in the normal course of business.

____

7. market segmentation theory

Time periods in which financing may be difficult to find and interest rates may be quite high by normal standards.

____

8. point of sales terminals

Equal monthly production used to smooth out production schedules and employ manpower and equipment more efficiently.

____

9. term structure of interest rates

A representative quantity from a probability distribution arrived at by multiplying each outcome times the associated probability and summing up the products.

____

10. expectations hypothesis

Current assets that will be reduced or converted to cash within the normal operating cycle of the firm.

____

11. tight money

The relative convertibility of short-term assets to cash.

____

12. Liquidity

Computer terminals in retail stores that may be used for inventory control or other purposes.

____

13. "permanent" current assets

Assets that are converted to cash within the normal operating cycle of the firm.

____

14. fixed assets

The relationship of short and long-term interest rates relies on the maturity preference of various financial institutions.

____

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