A Firm Needs External Financing to Support Increases in Operations

question 5

Multiple Choice

A firm needs external financing to support increases in operations if:

• A) the firm is operating at full capacity.
• B) the firm is accounting for a very less amount of financing feedbacks.
• C) the firm has a large amount of spontaneously generated funds.
• D) the firm is having economies of scale.
• E) the firm is operating at the breakeven point.

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Definitions:

Securities Act Of 1933

A U.S. law enacted to ensure transparency and fairness in the securities market, requiring issuers of securities to disclose significant information to investors.

Definition Of Security

A financial instrument that represents an ownership position in a publicly-traded corporation (stock), a creditor relationship with a governmental body or a corporation (bond), or rights to ownership as represented by an option.

Resold Without Registration

Referring to the sale of securities without registering them with the required regulatory body, often not in compliance with securities law.

Most Securities

Financial instruments that signify ownership (stocks), a debt agreement (bonds), or rights to ownership (derivatives) that investors can buy and sell.