A Flexible Short-Term Financial Policy

A flexible short-term financial policy:

A) Increases the likelihood that a firm will face financial distress.
B) Incurs an opportunity cost due to the rate of return that applies to short-term assets.
C) Advocates a smaller investment in net working capital than a restrictive policy does.
D) Increases the probability that a firm will earn high returns on all of its assets.
E) Utilizes short-term financing to fund all of the firm's assets.