In Which of the Following Situations Will Firm a Require

question 29

Multiple Choice

In which of the following situations will Firm A require greater amounts of external funding (additional funds needed, AFN) to meet its forecasted growth than Firm B? Assume the firms are identical in every other way. 

• A)Firm A operates at full capacity, whereas Firm B does not.
• B)Firm A uses the projected balance sheet method to forecast its pro forms financial statements, whereas Firm B does not.
• C)Firm A generates substantial amounts of spontaneously generated funds, whereas Frim B generates very little.
• D)Firm A has attained substantial economies of scale, whereas Firm B has not.
• E)Firm A operates close to its operating breakeven point, whereas Firm B operates well above its operating breakeven point.

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Definitions:

Sense

A faculty by which the body perceives an external stimulus; one of the faculties of sight, smell, hearing, taste, and touch.

Ankle Sprain

An injury to the ligaments in the ankle, caused by the ligaments being stretched beyond their normal capacity.

Psychologically Minimized

The process in which an individual's feelings or emotions are downplayed or regarded as less significant.

Physically Minimized

indicates having one's physical presence or the size of physical attributes reduced or made to appear smaller.