Ramanuj is thinking of starting an advertising agency. What will be the amount of working capital requirement for him?
Ramanuj is thinking of starting an advertising agency. What will be the amount of working capital requirement for him?
Solution
✅ Correct Option: 1
An advertising agency is a service business with a short operating cycle and no inventory of physical goods. Service enterprises generally need less working capital compared to trading or manufacturing firms, which have to invest in stock of raw materials, finished goods, and debtors. Hence Ramanuj needs less working capital.
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