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Forecasting Payments

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If a firm pays its bills with a 30-day delay, what fraction of its purchases will be paid for in the current quarter? In the following quarter? What if its payment delay is 60 days?

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The solution explains how to calculate the fraction of purchases that would be paid.

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If the firm pays bills with a 30-day delay, then it will pay for 60 days of purchases in the current quarter, since the first month will be paid in ...

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