The First Two Requirements of a Sound Business Model Are

question 76

Multiple Choice

The first two requirements of a sound business model are:

• A)generate revenues,make profits
• B)make profits,produce free cash flows
• C)produce free cash flows for creditors and owners of the venture
• Generate revenues and produce free cash flows

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Definitions:

Nondirectional Hypothesis

A hypothesis that predicts the existence of a relationship, not its direction.

Return on Equity

A measure of financial performance calculated by dividing net income by shareholders' equity, indicating how effectively management uses equity investments.

Total Capitalization

The total value of a company’s outstanding equity and debt.

Note Payable

A liability in a formal written promise to pay a specific amount of money at a future date or dates.