Question
Which of the following regarding financial distress is CORRECT? Select one: a. Increases in the probability of financial distress will cause managers to seek additional
Which of the following regarding financial distress is CORRECT? Select one: a. Increases in the probability of financial distress will cause managers to seek additional perquisite consumption to enrich themselves before corporate bankruptcy. b. Increased financial distress tends to cause risk-averse managers to undertake additional high-risk projects to save the company and their jobs. c. Financial distressed firms will seek to convert large cash reserves into additional raw materials to ensure that production will not be disrupted. d. The reduced credit opportunities provides an advantage to firms experiencing financial distress as it encourages the firm to reduce debt obligations. e. Increases in financial distress can cause a reduction in customers who are uncertain about the financial viability of suppliers.
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