Answered: National Co. has an inventory…

National Co. has an inventory conversion period of 65 days, a receivables conversion period of 42 days, and a payments cycle of 33 days. What is the length of firm's cash conversion cycle?

EBK CONTEMPORARY FINANCIAL MANAGEMENT

14th Edition

ISBN:9781337514835

Author:MOYER

Publisher:MOYER

Chapter16: Working Capital Policy And Short-term Financing

Section: Chapter Questions

Problem 3P

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Market Efficiency

Market efficiency refers to the market's ability to provide investors with all available information about investment options for buying and selling securities. Market efficiency reflects the true value of securities without undervaluing or overvaluing them. When the quality and quantity of information increase, the market becomes more efficient, allowing it to reduce arbitrage and obtain higher market returns from investment. In a well-functioning market, everyone receives all information completely and immediately at no cost. It opens up a plethora of opportunities for investors to access various investment options.

Question

National Co. has an inventory conversion period of 65 days, a receivables conversion period of
42 days, and a payments cycle of 33 days. What is the length of firm's cash conversion cycle? *
Format: 11

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