| Friday, November 12, 2004 - 04:18 am |
Alternatively you can look at it like this...
If said corp bought all the supplies it needed each month, and only enough for each month, it wouldnt make any money. The total cost of the goods buying 1 month at a time would be the same as the cost of goods bought in bulk every 12 monthes. Your profits each month would still total the same -0.3B or whatever at the end of that 12 month span.
If Profits for one month = P
And If Supplies for one month = S
And If cash change = C
P - S = C
Px12 - Sx12 = Cx12
C12 = C
Much easier to just buy once a year or 2 rather than each month. You are much less likely to have recurring shortages that way. Loans for a corp vary from 10B to 1T depending on how far into debt said corp went. The loans covers the difference in current cash, thats it. If you give me you countries name I can more acurrately tell why loans are being taken out.