level of investment in current assets

Sir there is a past exam question that Discuss key factors which determine level of investment in current assets ( 4 marks)

Sir is below answer correct?

The level of investment in current assets required is affected by the following factors:

1)The company’s credit policy. The tighter the company’s policy the 
lower the level of receivables.

2)The overall level of activity of the business. As output increases, 
receivables, inventory, etc. all tend to increase.

3)The nature of the business, e.g. manufacturing companies need 
more inventory than service companies.