Which of the following is the type of financial distress in which the return on a firm's assets is less than the firm's cost of capital?
A) Business failure
B) Economic failure
C) Technical insolvency
D) Business extension

Question

Quizplus · Accepted Answer

Economic failure occurs when a firm's return on assets is less than its cost of capital, indicating that the firm is not generating enough returns to cover its operational costs and investments.

Which of the Following Is the Type of Financial Distress