A Company That Makes Decorations for Christmas Trees Has High

question 30

Multiple Choice

A company that makes decorations for Christmas trees has high sales in its fourth quarter but very low sales during the rest of the year. It manufactures decorations steadily throughout the year, however. Which of the following is NOT a likely consequence of this scenario?

• A) The firm will need sources of short-term cash to fund inventory in the second and third quarters.
• B) The firm will see negative net cash flows in the second and third quarter.
• C) The firm will have a large short-term surplus in the fourth quarter.
• D) Accounts payables will rise from the first to fourth quarter.

Understand modern strategic management theories regarding the best competitive advantages.

Know the strategic importance of value chain activities and how they vary by industry.

Learn about the characteristics that do not lead to sustainable competitive advantages.

Understand the historical and methodological foundations of psychological assessment.

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Definitions:

Industry

Refers to a group of companies that are related based on their primary business activities.

Systematic Risk

The risk inherent to the entire market or market segment, which cannot be eliminated through diversification.

Rate of GDP Growth

The annual percentage increase in a country's gross domestic product, indicating the pace at which its economy is expanding or contracting.

Unsystematic Risk

The risk associated with a specific issuer of a security, such as a company's financial condition or management decisions, distinct from market risk.