The short-term financial policy that a firm adopts will be reflected in:

Question

Quizplus · Accepted Answer

Short-term financial policy refers to the management of a firm's current assets and liabilities. It involves decisions related to the financing of current assets such as inventory, accounts receivables, and cash reserves. Therefore, the short-term financial policy is reflected in both the size of the firm's investment in current assets (option A) and financing of those current assets (option B). Hence, option D is the correct choice. The financing of fixed assets is typically part of the firm's long-term financial policy, and it may not be directly impacted by the short-term financial policy.

The Short-Term Financial Policy That a Firm Adopts Will Be