There Is Often a Limiting Factor That Stops a Business

question 32

Multiple Choice

There is often a limiting factor that stops a business from achieving its objectives to the maximum extent. In most instances the limiting factor is:

• A)the ability of the business to advertise its products.
• B)the unrealistic goals of production managers.
• C)the unrealistic objectives set by management.
• D)the ability of the business to sell its products.

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Definitions:

Portfolio Risk

The potential for losses or lower than expected returns from an investment portfolio due to various factors like market volatility.

Interest Rate

The financial cost, expressed as a percent of the principal, that borrowers incur from lenders to use assets.

Present Value

The existing value today of a sum of money to be received in the future or continuous cash inflows, calculated at a certain rate of return.

Loanable Funds

The money available for borrowing, which includes savings that are available for investment and loans.