A business firm should have extra funds to meet future emergencies. Identify the type of working capital indicated here.

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Special Explanation: A firm may need additional working capital to meet future contingencies that may arise in business is called as special working capital. Special working capital is required in the unforeseen. contigencies such as: 1. To manage sudden increase of demand in the market; 2. Depression leading to piling up of inventory; 3. During strikes, lockouts, and national calamities like earthquakes, floods, fire, etc.

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