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    Question

    What does a decrease in the cash conversion cycle

    indicate?
    A Increased profitability Correct Answer Incorrect Answer
    B Delayed payment to suppliers Correct Answer Incorrect Answer
    C Faster conversion of assets to cash Correct Answer Incorrect Answer
    D Increased inventory levels Correct Answer Incorrect Answer
    E Slower conversion to cash Correct Answer Incorrect Answer

    Solution

    A decrease in the cash conversion cycle indicates that the company is able to convert its investments in inventory and other resources into cash more quickly. This reflects improved efficiency in managing inventory, receivables, and payables, leading to quicker cash flow generation.

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