A Business Entity That Shows a Positive Cash Flow from Operations,a

question 4

Multiple Choice

A business entity that shows a positive cash flow from operations,a negative cash flow (i.e. ,a cash outflow) from investing and a negative cash flow (i.e. ,a cash outflow) from financing is a business entity which:

• A) Is profitable,does not prepare itself for future challenges and reimburses its debt.
• B) Is incurring a loss,prepares itself for the future and has obtained new long-term funds from external sources.
• C) May be profitable or may experience a loss,probably invests more than it divests and probably has reimbursed some of its debt.
• D) May be profitable or may experience a loss,probably divests more than it invests and has issued new common stock for an amount in excess of the amount of dividends paid to current shareholders.

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Definitions:

Relational Bias

The tendency to perceive or judge in favor of those with whom one has a close relationship or to whom one feels similar.

Self-Disclosure

The sharing of information about oneself.

Xiao

In Confucian philosophy, the virtue of filial piety or respect towards one’s parents and ancestors.

Social Interdependence

A theory suggesting that the outcomes for individuals in any situation are determined by the actions and decisions of others, emphasizing the importance of cooperative goals over competitive ones.