When the level of working capital is increased, which of the following is not expected to occur?
A) profitability decrease
B) profitability increase
C) risk decrease
D) None of these choices are correct.

Question

Quizplus · Accepted Answer

When the level of working capital is increased, it is expected that profitability will increase because there is more capital available to invest in profitable projects. Additionally, increasing working capital can lead to a decrease in risk because the company has more buffer to manage unexpected expenses. Therefore, choice A and C are incorrect. Choice D is also incorrect because one of the choices is correct, which is B.

When the Level of Working Capital Is Increased, Which of the Following