Financial Management — Business Studies STD 12 Commerce — Question
CBSE BoardEnglish MediumSTD 12 CommerceBusiness StudiesFinancial Management1 Mark
Question
How does 'Inflation' affect the working capital requirements of a company? State.
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Answer
With the rising prices, larger amount of funds is required to maintain a constant volume of production and sales. The working capital requirement of a business is higher with higher rate of inflation.
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