For startup firms, some products are under development for years before they generate earnings. The upfront costs often exceed a firm's ability to fund these activities on its own. Which of the following reasons that motivate firms to seek funding or financing is illustrated in this example?
A) Cash flow challenges
B) Marketing costs
C) Capital investments
D) Personnel costs
E) Lengthy product development cycles

Question

Quizplus · Accepted Answer

This example illustrates the motivation for seeking funding or financing due to the lengthy product development cycles.

For Startup Firms, Some Products Are Under Development for Years