Disadvantages of Using Current Liabilities as Opposed to Long-Term Debt

question 141

Multiple Choice

Disadvantages of using current liabilities as opposed to long-term debt include

• A) greater risk of illiquidity.
• B) uncertainty of interest costs.
• C) higher cash flow exposure.
• D) both A and B.

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Definitions:

Revenue Streams

Different sources from which a business earns money from selling goods or providing services.

Consumer-Brand Relationship

The dynamic between consumers and brands, characterized by the depth of emotional connection and loyalty.

Strategic Outlook

A long-term planning perspective that helps organizations align their actions with their goals and adapt to changing environments.

Negative Equity

occurs when the value of an asset is less than the outstanding balance on the loan used to purchase that asset.