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CBSE Class 12 Business Studies 2026 All Sets Solved Paper

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Question : 19 of 21
Marks: +1, -0
Which of the following will require higher working capital ?
Solution:  
1. Trading: Usually needs less working capital than manufacturing.
2. Short cycles: Needs less capital because stock is converted to cash quickly.
3. Strict credit: Needs less capital because cash is collected quickly.
4. High competition: Requires more working capital because the firm may need to maintain higher stock levels to meet immediate demand or offer liberal credit terms to attract customers.
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