1. The moderate approach to current asset financing is the least profitable but the safest of all the three approaches.
True
False
2. All else equal, firms that hold greater amounts of short-term assets are considered riskier than firms that hold greater amounts of long-term securities.
True
False
3. A firm must pay _____ costs even if it produces and sells nothing.?
a. breakeven
b. lumpy
c. direct labor
d. fixed
e. variable
4. Companies provide cash discounts to customers for early payments to speed up the collection period.
True
False
5. The funds that are obtained from routine business transactions are referred to as spontaneously generated funds.
True
False