Company recently pays one of its creditors; consequently, its Working Capital should immediately be a) increased b) decreased c) remains constant?

the result of paying creditors is two influences :

first is decrease of cash which is inserted under current assets

second is decrease of creditors which is inserted under current liabilities at the same value

working capital = current assets - current liabilities

consequently ....... the company WC is remains constant

the third choice is true C

Third option C >>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>

........((( C ))) ........ 

( C ).............................

The correct answer in the third C

.................c .........................

Answer is "C"

as paying to creditors decrease cash which can decrease current assets but on the other side creditor also decrease so ultimately effect remain constant "working capital = current assets - current liabilities"

Answer is option C. As both the Creditors (if its a current liability) and Cash/Bank (Current asset) decrease by the same magnitude, the ultimate effect on working capital remains nil.

At the same time,if the creditor mentioned here is a long term or non-current liability, then option B is correct , i.e. working capital decreases because cash/bank (current asset)used to pay off long term creditor (non-current ;liability) 

.....................c........................

It depends upon the financial situation of the company. If it is well then no need to worry otherwise  the option is (a) Increased. Thanks.