Suppose a firm experiences a seasonal pattern in its sales,in addition to a long-term upward trend.Which of the following financing plans has the potential to be less risky to the firm?

Question

Quizplus · Accepted Answer

A conservative financing strategy is less risky for a firm with seasonal sales and a long-term upward trend because it involves maintaining a higher level of cash reserves or securing long-term financing to cover short-term fluctuations. This approach reduces the risk of cash shortages during low sales periods.

Suppose a Firm Experiences a Seasonal Pattern in Its Sales,in