The Savvy Entrepreneurial Firm Feature in Chapter 7 Focuses on Globat.com

question 10

Multiple Choice

The Savvy Entrepreneurial Firm feature in Chapter 7 focuses on Globat.com, a Web hosting company, which encountered a crisis described in the feature. The main point of the feature was to illustrate that the manner in which a company handles a crisis:

• A) has a bearing on its ability to develop high quality business partnerships
• B) provides an important standard for how it handles crises in the future
• C) limits its legal liability
• D) limits or contains the damage to its brand
• E) sends a message to its customers regarding its values and trustworthiness

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Definitions:

Average Collection Period

The average number of days it takes for a company to receive payments owed by its customers.

Trade Credits

An agreement where a buyer is allowed to purchase goods or services and pay the supplier at a later scheduled date.

Business

The organized efforts and activities of individuals to produce and sell goods and services for profit.

Accounting Methods

The systematic practices a business uses to record and manage its financial transactions.