In the current recessionary environment, equity investors reward firms with high free cash flows. If you...

In the current recessionary environment, equity investors reward firms with high free cash flows. If you are a CFO trying to boost your firm’s stock price, which measure is likely to increase FCF of the firm?

	a.	Offer buyers more time to pay for their purchases (increasing account receivables)
	b.	Adopt a schedule to reduce the pace of depreciation of the firm’s assets
	c.	Increase inventories
	d.	Ask suppliers to increase the period to pay for the purchase of raw materials and inputs

Solutions

Expert Solution

Ask suppliers to increase the period to pay for the purchase of raw materials and inputs

because it raises liabilities which is positive for FCFF

jeff jeffy answered 2 years ago

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