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Moderate Current Asset Investment Policy Relaxed Current Asset Investment Policy Restricted Current Asset Investment Policy Fuzzy Button Clothing Company tries to hold optimal levels of

Moderate Current Asset Investment Policy

Relaxed Current Asset Investment Policy

Restricted Current Asset Investment Policy

Fuzzy Button Clothing Company tries to hold optimal levels of current assets (including cash, marketable securities, accounts receivable, and inventory), such that it balances the potential costs of running through its assets with the cost of holding balances in those assets.

Lumbering Ox Truckmakers is a relatively young technology firm that is slightly past the startup stage but still faces significant capital constraints that do not allow any overinvestment in current assets. Consequently, the firm must be careful about how it invests its funds.

Cold Duck Manufacturing Inc. is a mature firm that has reliable funding sources and strong, stable cash flows. It places a higher value on avoiding current asset shortages than it does on minimizing the cost of holding current assets.

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