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Inventory Turnover, Flotations Costs, and Equity Financing

1. Why would an inventory turnover ratio be more important for a retailer than a consulting firm?

2. Describe the various flotation costs from issuing stock. How do those flotation costs compare to those from issuing bonds?

3. What signals are provided to investors when a company obtains equity financing? What signals are provided to investors when a company obtains debt financing?

4. Is it possible for a firm to have negative working capital? Please explain and provide an example

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1) An inventory turnover ratio indicates the efficiency ratio that ...

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