The risk of the conservative funding requirements is low because of its high level of net working capital, and the fact that the strategy does not require a firm to use any of its limited short-term borrowing capacity.

Question

Quizplus · Accepted Answer

The statement correctly assesses the risk of conservative funding requirements by highlighting the high level of net working capital and the lack of dependence on short-term borrowing, which both contribute to a low risk.

The Risk of the Conservative Funding Requirements Is Low Because