Pop Co is switching from using mainly long-term fixed rate finance to fund its working capital to using mainly short-term variable rate finance. Which of the following statements about the change in Pop Co's working capital financing policy is true?

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Economics · Financial Management

Verified Solution4 OptionsUpdated: October 2026👁️1 View

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Re-financing risk will increase

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Answer 1

Overcapitalisation risk will decrease

Answer 2

Interest rate risk will decrease

Answer 3

Re-financing risk will increase

Answer 4

Finance costs will increase

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