A firm which successfully employs a ___________ short-term financial policy will probably _______________ its risk of default and/or inventory stock-outs.
A) flexible; increase
B) restrictive; increase
C) neutral; increase
D) flexible; not change
E) restrictive; decrease

Question

Quizplus · Accepted Answer

A restrictive short-term financial policy involves maintaining lower levels of cash and inventory, which can increase the risk of default and inventory stock-outs.

A Firm Which Successfully Employs a ___________ Short-Term Financial Policy