A Firm Is Known as a 'Cash Cow

question 19

Multiple Choice

A firm is known as a 'Cash Cow':

• A) because it has several good growth opportunities.
• B) because it pays out all of its non-growing earnings.
• C) because dividends are growing at a rapid rate.
• D) because the discount rate is extremely low.

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Definitions:

Customer Analytics

The process of analyzing customer data to understand behavior, preferences, and trends to improve business decisions.

Aggressive Investment

An investment strategy characterized by seeking higher returns through taking on a greater level of risk, typically involving investments in volatile stocks, sectors, or markets.

Product Life Cycle

The series of stages a product goes through from introduction to the market, growth, maturity, and eventually decline.

Strategic Fit

The degree to which an organization’s strategies align with its external environment and internal resources and capabilities.