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What do we mean by working capital requirement

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Q1) What do we mean by 'working capital requirement'. What does it represent? Is it important to take working capital into consideration when thinking about an investment project? If so, why?

Q2) What are the elements which make up the working capital of a company? Give a short comment on each of the elements making up the working capital?

Q3) Why do we need to calculate the net present value of a project by discounting future cash flows when considering an investment? Can you explain why the free cash flow is the critical measure for the parties that finance a project, whether they finance in debt or in equity?

Reference no: EM132768814

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