A(n) _ in current assets net working capital, thereby _ the risk of technical insolvency.

Question

Quizplus · Accepted Answer

An increase in current assets increases net working capital, thereby reducing the risk of technical insolvency. Net working capital is the difference between a company's current assets and current liabilities, and an increase in current assets (assuming liabilities remain constant) increases this difference, enhancing the company's ability to cover short-term obligations and thus reducing insolvency risk.

A(n) _ in Current Assets Net Working Capital, Thereby _