After Reviewing the Operating Budgets for the Next Fiscal Year,Lauren

question 20

Multiple Choice

After reviewing the operating budgets for the next fiscal year,Lauren suggested that the budget for marketing communications be boosted by $124,000 since the sports property was able to trim other budgets.This is most likely an example of which method of setting communication budgets?

• A)affordability
• B)objective and task
• C)percentage of sales
• D)return on investment

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Definitions:

Higher Valuation

Represents an increased assessment of a company's financial value based on its assets, earnings, and market potential.

Negative Cash Flows

A financial situation where a business or individual's outflows of cash exceed their incoming cash.

Significant Earnings

Refers to a considerable amount of profit or income generated by an individual or an organization.

Venture Capital Method

A valuation method used in private equity to estimate the value of a startup by considering expected future cash flows and potential returns to investors.