Activity #4

No Double Spacing!!

1. Why might one firm use one set of financial ratios and another firm use a different set of financial ratios to evaluate financial condition and performance?

2. For some agribusiness firms, the sale of some of their products is seasonal (i.e., fertilizer, seed, etc.). Discuss how that would impact the need for outside financial resources and the type of loan that should be used to meet any cash shortfalls.

3. Explain the difference between variable and fixed costs. Give examples of each of these types of costs.