The Conservation of Value Corollary of the Value-Creation Principle Says

question 7

Multiple Choice

The conservation of value corollary of the value-creation principle says that:

• A)Reducing costs is the first step in creating value.
• B)Return on invested capital must increase over time to create value.
• C)Anything that does not increase cash flows does not create value.
• D)Acquisitions always create more value than divestitures.

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Definitions:

Forecasted Demand

An estimate of the quantity of a product or service that consumers will purchase in the foreseeable future.

Periodic Review

An evaluation process conducted at regular intervals to assess performance, inventory levels, or other critical factors in operations and management.

Inventory Status

This term describes the current state or levels of stock and inventory items within a business, indicating availability for sale or production use.

Specified Threshold

A predetermined level or point at which an action is triggered or a condition changes, often used in decision-making processes.