Question

Folks - Which do you think would be the most risky to work with cash, credit or inventory management in an international capital structure? Please explain your answer using your research.

Answer 1

Answer :-

The Cash , Credit and Inventory management all are very risky in an international capital structure

The Cash has a very high risk purpose Which we said as a risk of misappropiation

and the Credit also has a risk that is of risk identification

and the inventory management also has a risk of damage of inventory , risk of theft etc. many other

So all these three are risky

But as question asked , According to me the most risky is of Credit as the change in value of money leads to change in value of amount received or paid and also there is a risk of not receiving money in case of having no security. In case of credit assume if the value of the base currency is decreased as compared to funtional currency then this leads to a great loss