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प्रश्न
TRUE OR FALSE.
When a liberal credit policy is followed, more working capital is required.
सत्य या असत्य
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उत्तर
This statement is true.
Explanation:
When a business follows a liberal credit policy (selling on credit and allowing customers more time to pay), it has more debtors and less cash in hand. Therefore, it needs more working capital to cover daily expenses while waiting for payments.
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