Which policy will produce the higher expected profitability

Reference no: EM131336725

1. Why is no single working capital investment and financing policy necessarily optimal for all firms? What additional factors need to be considered in establishing a working capital policy?

2. a. Which of the following working capital financing policies subjects the firm to a greater risk?

i. Financing permanent current assets with short-term debt

ii. Financing fluctuating current assets with long-term debt

b. Which policy will produce the higher expected profitability?

Reference no: EM131336725

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