Which strategy could a business use to effectively manage receivables?
(A) Offering discounts for early payment
(B) Increasing the price of the product
(C) Taking out a short-term loan
(D) Increasing its overdraft - HSC - SSCE Business Studies - Question 8 - 2001 - Paper 1
Question 8
Which strategy could a business use to effectively manage receivables?
(A) Offering discounts for early payment
(B) Increasing the price of the product
(C) Taking... show full transcript
Worked Solution & Example Answer:Which strategy could a business use to effectively manage receivables?
(A) Offering discounts for early payment
(B) Increasing the price of the product
(C) Taking out a short-term loan
(D) Increasing its overdraft - HSC - SSCE Business Studies - Question 8 - 2001 - Paper 1
Step 1
Offering discounts for early payment
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Answer
Offering discounts for early payment is a strategy that incentivizes customers to pay their invoices sooner. This can improve cash flow and reduce the aging of receivables.
