When we use the AFN equation to forecast the additional funds needed (AFN),we are implicitly assuming that all financial ratios are constant.If financial ratios are not constant,regression techniques can be used to improve the financial forecast.

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This statement is true. If financial ratios are not constant, regression techniques can be used to improve the financial forecast. The AFN equation assumes that all financial ratios will remain constant, but in reality they may fluctuate, so using regression analysis can help adjust for these changes.

When We Use the AFN Equation to Forecast the Additional