4. Under the moderate approach (maturity matching) to current asset financing, which of the 6. Which of the following is not true? following is not true? a. In a "2/10, net 30,"trade credit deal, the firm receives a 2% discount if the bill is a. The firm uses meets part of its season needs by storing liquidity in the form of paid in 10 days, otherwise the firm pays the full amount in 30 days marketable securities b. Trade credit is easy to obtain but is an expensive form of short-term financing b. Temporary current assets are entirely financed by short-term, nonspontaneous c. Commercial paper is considered to be a discounted loan debt financing d. If the compensating balance of a bank loan cams interest, the loan is more c. The permanent level of current assets and fixed assets is entirely financed by expensive for the firm long-term debt plus equity plus spontaneous current liabilities e. All of the above are true. d. Uncertainty about the lives of assets prevents exact maturity matching e. All of the above are true. 7. Which of the following is not true? a. Under the Baumol model, an increase in cash deposit size leads to less fixed costs 5. Which of the following is not true? per year . The cash conversion period is equal to the average collection period plus the b. Under the Baumol model, an increase in cash deposit size decreases the inventory conversion period minus the payables deferral period opportunity cost for the firm b. The cash conversion period is the time from when the firm pays cash for c. The Miller-Orr model is an extension of the Baumol model, allowing daily cash purchased materials until the time the fin collects cash for accounts receivable nows to vary according to a probability function c. The cash conversion period is the time from when the firm receives materials d. Under the Miller-Orr model, the firm makes no cash transactions if the cash until the time the firm pays for purchased materials plus the average collection balance is between the lower and upper control limits period e. All of the above are true. d. The cash conversion period can be negative c. All of the above are truc