With an increase of investment in fixed assets, there is a commensurate ________ in the working capital.

decrease

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increase

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equality

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None of the above

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Solution

The correct option is B increase
Net working capital= current asset- current liablities
Therefore increase in investments in fixed assets will lead to increase in the working capital

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With an increase of investment in fixed assets, there is a commensurate ________ in the working capital.

The correct option is B increaseNet working capital= current asset- current liablitiesTherefore increase in investments in fixed assets will lead to increase in the working capital

The correct option is B increase
Net working capital= current asset- current liablities
Therefore increase in investments in fixed assets will lead to increase in the working capital