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Better inventory management, better collections and longer supplier terms together will:
AShrink the share price
BShift the audit date
CShorten the cash cycle
DSharpen the tax rate
Answer & Solution
Correct answer: C. Shorten the cash cycle
1. Each change frees cash sooner.
2. The gap narrows at both ends.
3. The cash cycle shortens.
_Source: OpenStax Principles of Finance 2e, Chapter 19, The Importance of Working Capital._
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