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A flexible short-term financial policy: Multiple Choice is most appropriate when carrying costs are high and shortage costs are low. maximizes fixed assets and minimizes current assets. avoids bad debts by only selling items for cash. increases the need for long-term financing. minimizes net working capital.

Answer :

Answer: increases a firm's need for long-term financing

Explanation:

Short term financing is the financing of business from short term sources that are for a period of less than a year which helps the firm in generating cash for operating expenses and working of the business which is usually for a lower amount.

A flexible short-term financing policy typically maintains a high ratio of its current assets to sales. The policy includes the limited use of short-term debt and a heavy reliance on long-term debt when carrying costs are low and shortage costs are high.

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