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प्रश्न
How does 'Inflation' affect the working capital requirements of a company? State.
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उत्तर
During the inflationary situation, there will be a rise in the prices of inputs and wages to labourers. This further leads to an increase in funds to meet the required volume of production and sales. Therefore, the working capital is affected by the inflationary condition.
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संबंधित प्रश्न
Big retail stores requires large amount of ............................. capital.
- Fixed
- Working
- Loan
Rizul Bhattacharya after leaving his job wanted to start a Private Limited Company with his son. His son was keen that the company may start manufacturing of Mobile-phones with some unique features. Rizul Bhattacharya felt that the mobile phones are prone to quick obsolescence and a heavy fixed capital investment would be reuired regularly in this business. Therefore he convinced his son to start a furniture business.
Identify the factor affecting fixed capital requirements which made Rizul Bhattacharya to choose furniture business over mobile phones.
Answer the following question.
Explain briefly any four factors affecting the fixed capital requirements of an organisation.
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A state with reason whether the working capital requirements of ‘Reliable Transport Services’ will be high or low.
Explain the following as factor affecting the requirements of fixed capital:
Natural of business
Explain the following as factor affecting the requirements of fixed capital:
Level of collaboration
Explain the following as factor affecting the requirements of working capital:
Availability of raw material
Explain the following as a factor affecting the requirement of working capital:
Level of competition
What are the factors affecting requirement of fixed capital?
What is Working Capital? Factors affecting requirement of Working capital?
Answer the following question.
You are the finance manager of a newly established company. The Directors have asked you to determine the amount of fixed capital requirements for the company. Explain any five factors that you will consider while determining the fixed capital requirement for the company.
Discuss in brief any four factors that affect the working capital requirement of a company.
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State any three factors that determine the requirement of fixed capital of a company.
Match the factors affecting fixed capital requirements given in Column - I with their explanations given in Column - II:
| Column - I | Column - II | ||
| (A) | Nature of Business | (i) | A trading organisation needs lower investments in fixed assets as compared to a manufacturing organisation. |
| (B) | Technology upgradation | (iii) | A textile manufacturing company is installing a cement manufacturing plant and thus its investments in fixed assets is increasing. |
| (C) | Diversification | (iii) | A capital-intensive organisation requires higher investments in fixed assets as compared to labour- intensive organisation. |
| (D) | Choice of Technique | (iv) | Mobile phones became obsolete faster and are replaced much sooner than furniture or many other assets. Hence, these type of businesses require more fixed capital. |
