Which Statement Is True About Company Growth

question 109

Multiple Choice

Which statement is true about company growth?

• A)Successful growth occurs on it own.
• B)A high-growth firm's need for additional financing may exceed its available resources,even though the venture is profitable.
• C)Inventory needs will increase while account receivables will decrease with growth.
• D)While rapid growth may stress personnel,the increase in pay will be sufficient.

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Definitions:

Business Combination

A transaction or event in which an acquirer obtains control of one or more businesses.

Fair Market Value

An estimate of the price at which an asset or property would change hands between a willing buyer and seller, neither being under any compulsion to buy or sell and both having reasonable knowledge of relevant facts.

Tax Standpoint

A perspective or consideration related to tax implications, obligations, or benefits in financial planning and decision making.

Net Assets

The difference between total assets and total liabilities, representing the owner's or shareholders' equity in a company.