A new project would require an immediate increase in raw materials in the amount of $1,000. The firm expects that accounts payable will automatically increase $800. How much must the firm expect its investment in net working capital to change if they accept this project?

Question

Quizplus · Accepted Answer

The net working capital change is calculated as the increase in raw materials ($1,000) minus the increase in accounts payable ($800), resulting in a net increase of $200.

A New Project Would Require an Immediate Increase in Raw