Logo
Home Study Material Contact Search
AI Chat FREE
  1. business
  2. finance
  3. all else constant, an increase in the days invento

All else constant, an increase in the days inventory held period will have what effect on...

80.2K

Verified Solution

Question

Finance

All else constant, an increase in the days inventory held periodwill have what effect on the net present value (NPV) of workingcapital

a. it depends

b. decrease in NPV

c. increase in NPV

d. no change in NPV

Answer & Explanation Solved by verified expert
4.4 Ratings (900 Votes)
This has various interpretations At the outset let us first agree on the term days inventory held period I assume your books teach this to be the average number of days the company holds the inventory before selling it Let us understand how it can increase When the company buys excess inventory but sales did not increase along with inventory Here value of inventory increases which causes an increase in days inventory held period When the sales significantly drop    See Answer
Get Answers to Unlimited Questions

Join us to gain access to millions of questions and expert answers. Enjoy exclusive benefits tailored just for you!

Membership Benefits:
  • Unlimited Question Access with detailed Answers
  • Zin AI - 3 Million Words
  • 10 Dall-E 3 Images
  • 20 Plot Generations
  • Conversation with Dialogue Memory
  • No Ads, Ever!
  • Access to Our Best AI Platform: Flex AI - Your personal assistant for all your inquiries!
Become a Member

Other questions asked by students

Basic Math
1.2K views

Use two functions below for parts a and b. ? ?(?)=???? ? ?(?)=ln(?)+ln(1??)+3 a) Find the stationary points,...

Biology
1.2K views

Use the diagram above to help you figure out the answer The scientific name for...

Biology
1.2K views

The metabolic conversion of glucose to amino acids is called Glycogenolysis Gluconeogensis There is no...

Physics
1.2K views

A cathode ray tube is shown in Figure Q3a Electrons increase speed due to the...

Geometry
1.2K views

Find the length of each arc Round to the nearest tenth 5T 3 5 62...

Accounting
1.2K views

Mr. and Mrs. Orange and their two children, Clementine and Tangerine, are the four...

Accounting
1.2K views

CASH and BR Problem 14-5 (ACP) Love Company reported the following information in relation...

Accounting
1.2K views

Wise Guy Company is working on a creative project with the following characteristics: (1) the...

Accounting
1.2K views

Enment 2 The Toyota Camry is one of the best-selling cars in North America. The...

Accounting
1.2K views

The Florida Division of Garner Furniture reported the following results for 2014: Invested capital $800,000...

Accounting
1.2K views

The company maintained a line of credit during the year which shows a balance of...

Accounting
1.2K views

Generally, the LOWER the capacity amount used when budgeting overhead, the HIGHER the Fixed Overhead...