Net working capital is a measure of a company's: a. goodwill. b. short-term liabilities. c. estimated cash reservoir. d. shareholders' equity.

The correct answer is C. estimated cash reservoir.

Explanation:

Indicates the amount of resources that a company has to be able to continue working once all short-term liabilities are paid. These resources must be available in the short term, and the company can dispose of them immediately.

In technical terms, net working capital is calculated by subtracting current liabilities from current assets.

Companies, in addition to investing in fixed assets (capital expenditures), can allocate their funds in net working capital, this is what is known as a change in net working capital. It is the difference between the net working capital of a period with respect to the previous period. In growing companies, it is usually positive.

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