A rapid rate of growth in sales and profits may require:
A) higher dividend payments to shareholders.
B) increased borrowing by the firm to support the sales increase.
C) the firm to be less lenient with credit customers.
D) sales forecasts to be made less frequently.

Question

Quizplus · Accepted Answer

If a firm is experiencing rapid growth in sales and profits, it may need to boost production and expand its operations. This will require a significant amount of capital, which may not be readily available from retained earnings or sales revenue. In this case, the firm may need to take out loans to fund these expansions.

A Rapid Rate of Growth in Sales and Profits May