Which of the following statements is false regarding trade credit?
A) Trade credit is created when a firm uses cash to make purchases from another firm.
B) Trade credit is not usually an interest-bearing asset for the firm granting the credit.
C) Trade credit possesses a degree of default risk.
D) Collection of trade receivables can be sped up by offering discounts.
E) Trade credit is an important source of external financing for Canada firms.
Correct Answer:
Verified
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