Question
Choose the most logical order of sentences from among the
four given choices to construct a coherent paragraph. (A) The goal of working capital management is to maximize operational efficiency.(B) By improving the way they manage working capital, companies can free up cash that would otherwise be trapped on their balance sheets. (C) Working capital management is a business process that helps companies make effective use of their current assets and optimize cash flow. (D) It’s oriented around ensuring short-term financial obligations and expenses can be met, while also contributing towards longer-term business objectives.Solution
The correct sequence is CDAB.Sentence C defines working capital management, making it a strong introductory sentence.
Sentence D builds on this definition by explaining its purpose—managing short-term obligations while aligning with long-term goals.
Sentence A then states the primary objective of working capital management, providing more clarity on its importance.
Sentence B logically concludes the paragraph by explaining the benefits of effective working capital management—freeing up cash trapped on balance sheets.
As a result, they may be able to reduce the need for external borrowing, fuel growth, fund mergers or acquisitions, or invest in R&D.
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