Occasionally, a Company Will Encounter Circumstances in Which Cash Flows

question 50

Multiple Choice

Occasionally, a company will encounter circumstances in which cash flows are temporarily negative for an unexpected reason. We refer to such a situation as a ________.

• A) liquidity shock
• B) negative cash flow shock
• C) negative liquidity shock
• D) cash crunch

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Definitions:

Insulin Shock

A severe hypoglycemic condition resulting from an overdose of insulin, leading to low blood sugar levels, confusion, and unconsciousness.

Alpha Cells

Endocrine cells in the pancreas that produce glucagon, which raises blood glucose levels.

Beta Cells

Cells located in the pancreas that produce and secrete insulin, a hormone that regulates blood glucose levels.

Phosphorylation

Addition of phosphate to an organic compound.