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If a Firm's Capital Intensity Ratio (A0∗/S0)\left( \mathrm { A } _ { 0 } { } ^ { * } / \mathrm { S } _ { 0 } \right)

Question 19

True/False

If a firm's capital intensity ratio
(A0∗/S0)\left( \mathrm { A } _ { 0 } { } ^ { * } / \mathrm { S } _ { 0 } \right) decreases as sales increase,use of the AFN formula is likely to understate the amount of additional funds required,other things held constant.

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