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Question :-

Determining the appropriate level of working capital for a firm requires:
Changing the capital structure and dividend policy of the firm.
Maintaining short-term debt at the lowest possible level because it is generally more expensive than long-term debt.
Offsetting the benefit of current assets and current liabilities against the probability of technical insolvency.
Maintaining a high proportion of liquid assets to total assets in order to maximize the return on total investments.

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