What type of situation will result in a firm having temporary working capital needs?
A)A steady clientele of buyers for the firm's product.
B)A specialized product for summer outdoor sports.
C)A product that is essential for a number of different manufacturing processes.
D)A routine service provided on the basis of long-term contracts.

Question

Quizplus · Accepted Answer

A firm may have temporary working capital needs when it produces a product that is seasonal or has a specific limited demand. In this case, the specialized product for summer outdoor sports would likely have a higher demand during the summer season, creating a temporary need for working capital to meet the production and inventory needs during that time.

What Type of Situation Will Result in a Firm Having