Working capital management is one of the key areas of financial decision-making.It is significant because, the management must see that an excessive investment in current assets should protect the company from the problems of stock-out.Current assets will also determine the liquidity position of the firm.The goal of working capital management is to manage the firm current assets and current liabilities in such a way that a satisfactory level of working capital is maintained.If the firm cannot maintain a satisfactory level of working capital, it is likely to become insolvent and may be even forced into bankruptcy.
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Manasa et al. (2024) studied this question.
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