Reference no: EM131844211

Suppose a firm makes the following policy changes. If the change means that external nonspontaneous financial requirements (AFN) will increase, indicate this with a (+); indicate a decrease with a (-); and indicate an indeterminate or negligible effect with a (0). Think in terms of the immediate short-run effect on funds requirements. a. The dividend payout ratio is increased. b. Rather than produce computers in advance, a computer company decides to produce them only after an order has been received. c. The firm decides to pay all suppliers on delivery, rather than after a 30-day delay, to take advantage of discounts for rapid payment. d. The firm begins to sell on credit. (Previously, all sales had been on a cash basis.) e. The firm’s profit margin is eroded by increased competition; sales are steady. f. Advertising expenditures are stepped up. g. A decision is made to substitute long-term mortgage bonds for short-term bank loans. h. The firm begins to pay employees on a weekly basis. (Previously, it had paid employees at the end of each month.)