Question

Trade credit is commonly used by business organisations as a source of ___________ financing.

• A. Short-term
• B. Long-term
• C. Medium-term
• D. Both A and C

Answer 1

The correct option is A Short-term

Trade credit is commonly used by business organisations as a source of short-term financing. Trade credits are generally a small amount of finances that are provided by the traders to another trader or a company to ensure smooth flow of trade cycle in the supply chain.