2economic activity especially economic 2economic

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Unformatted text preview: ivables or inventories. 2.Economic Activity — Especially economic 2.Economic downturns – can contribute to the failure of a firm. downturns • If the economy goes into recession , sales If decrease • In 1990s, a number of major Business Failures In such as Olympia & York (Real Estate), America West Air Lines, resulted from over expansion & the recessionary economy. recessionary 3.Corporate Maturity: A final cause of Business 3.Corporate Failure is corporate maturity. Firms, like individual do not have infinite lives. Like a product , a firm goes through the stages of birth, growth, maturity, & eventual decline . # Voluntary Settlements An arrangement between a technically insolvent or An bankrupt firm & its creditors enabling it to bypass many the costs involved in legal bankruptcy proceedings. proceedings. • The settlement is normally initiated by the debtor The firm, because such an arrangement may enable it t continue to exist or to be liquidated in a manner that gives the owners the greate...
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This note was uploaded on 03/24/2012 for the course BBA SBM taught by Professor Goa during the Spring '09 term at East West University, Chicago.

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