The Financial Strategy of a Firm Involves Decisions About the Action

question 7

True/False

The financial strategy of a firm involves decisions about the action to be taken with profits,how funds will be spend or invested,and how any additional funds will be raised.

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Definitions:

Market Demand

The combined amount of a product or service that every consumer in a market is prepared and capable of buying at different price points.

Elastic

A characteristic of a good or service whose demand or supply changes significantly when its price changes, indicating sensitivity to price adjustments.

Sunk Costs

Expenses that have been incurred and cannot be recovered, which should not impact future business decisions.

Barriers to Entry

Obstacles that make it difficult for new competitors to enter a market, including high startup costs, legal restrictions, and strong brand identity.