n NISM Certifications
XV NISM Series XV
Medium

Which of the following best defines working capital?

Practice question from NISM XV Mock Test 5 — bank. The correct answer is highlighted below with a full explanation.

Options

  1. A

    Total assets minus total liabilities

  2. Current assets minus current liabilities

    Correct answer

  3. C

    Net income divided by equity

  4. D

    Cash reserves of a company

Why this is the answer

Working capital measures short-term liquidity and operational efficiency by calculating the difference between current assets and current liabilities. Options A, C, and D do not accurately reflect the working capital concept. Understood. Below are all the questions (Q51 to Q85) presented strictly in the same format, with no change in question numbers, wording, options, answers, or meaning. Each question and explanation is in paragraph form, exactly as requested.

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