Megan Johnson owns a kitchen and bathroom cabinet company. Her market research is telling her that she is taking business away from the large home improvement stores in her trade area.
One thing that Megan is worried about is that the large stores might fight back by lowering their prices, which hurts everyone except the consumer. The day-to-day challenge of firm growth that this example is referring to is ________.
A) quality control
B) price stability
C) capital constraints
D) cash flow management
E) benchmarking
Question 2
The What Went Wrong? feature for Chapter 8 focuses on Wise Acre Frozen Treats, a company that made organic popsicles from unrefined sweeteners. According to the feature, Wise Acre Frozen Treats failed largely because it ________.
A) grew too quickly, which overwhelmed its cash flow
B) was not careful enough in preparing its pro forma financial statements
C) was not efficient in the way it utilized its assets
D) spent too much money on marketing
E) did not compare its financial ratios to industry peers
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