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Question : Case Study: XYZ Ltd. - Raising Finance for Expansion

XYZ Ltd. is a growing company that manufactures electronic gadgets. The company has been successful in the market and is planning to expand its operations. To finance this expansion, XYZ Ltd. is considering various sources of business finance.

Questions : Meaning and Need for Business Finance

What is the primary purpose of financial planning for a business like XYZ Ltd.?

Option 1: Maximizing profits at any cost
 

Option 2: Meeting short-term operational needs only
 

Option 3: Achieving long-term financial goals and stability

 

Option 4: Reducing the company's workforce


Team Careers360 16th Jan, 2024
Answer (1)
Team Careers360 22nd Jan, 2024

Correct Answer: Achieving long-term financial goals and stability

 


Solution : The correct answer is (c) Achieving long-term financial goals and stability

Financial planning in a business involves creating a comprehensive strategy to manage financial resources efficiently, allocate funds effectively, and achieve both short-term and long-term financial objectives. It's about ensuring the company's stability and growth over time, managing risks, optimizing resource utilization, and making informed decisions to achieve sustainable success in the long run. The goal is to achieve financial stability and meet the company's long-term goals and objectives, rather than focusing solely on short-term operational needs or maximizing profits at any cost.

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