1. A major difference between a venture’s operating cycle and the cash conversion cycle is the conversion cycle includes the time to:
buy materials
produce a finished good
collect sales made on credit
pay suppliers for purchases on credit
2. Everything else equal, which of the following will result in the lowest present value of an amount to be received in the future?
a. Monthly compounding of interest.
b. Simple interest.
c. Quarterly compounding of interest.
d. Annual compounding of interest.
e. Semi-annual compounding of interest.