Asked by Anaelle Gauthier on Jul 11, 2024
Verified
Large investments in inventory is associated with a restrictive short-term financial policy.
Investments In Inventory
Funds allocated towards purchasing goods for sale or raw materials to produce goods, aiming at generating future revenues.
Restrictive Policy
A policy designed to limit or restrict certain behaviors, actions, or practices, typically in a financial or regulatory context.
- Understand the effect of short-term financial policies on managing liquidity and cash assets.
Verified Answer
SS
Sugeetha SattiyanJul 15, 2024
Final Answer :
False
Explanation :
A restrictive short-term financial policy is typically associated with lower levels of inventory investment to minimize holding costs and increase efficiency, whereas a more relaxed policy might involve larger investments in inventory.
Learning Objectives
- Understand the effect of short-term financial policies on managing liquidity and cash assets.
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