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Q. Explain about Temporary or Variable Working Capital ?
Temporary or else Variable Working Capital - Any amount over and above the permanent level of working capital is called temporary and fluctuating or variable working capital. The distinction among permanent and temporary working capital is illustrated in the following diagram:-
SHOWING PERMANENT AS WELL AS TEMPORARY WORKING CAPITAL:
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Assume that ABC is considering opening an ice cream shop in Amsterdam. The shop will cost 1.8 million Euros, and the present value of the expected cash flows from the store is 1.4
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