When a vulture fund acquires a distressed loan,the fund usually assists the distressed firm's managers in formulating a long-term plan for restoring profitability.

Question

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Vulture funds typically prioritize short-term gains over long-term sustainability, so they are more likely to focus on restructuring the distressed loan to quickly recover their investment, rather than assisting the firm's managers with a long-term plan for profitability.

When a Vulture Fund Acquires a Distressed Loan,the Fund Usually