For a firm to survive over the long term it must:
A)Pay a satisfactory level of dividends to its shareholders
B)Create customer loyalty,that can then be converted into profit through increasing prices
C)Earn as rate of return that covers its cost of capital
D)Balance the interests of all its stakeholders.

Question

Quizplus · Accepted Answer

Earning a rate of return that covers its cost of capital is essential for a firm to survive over the long term. It is important to ensure that the profits earned by the firm are sufficient to cover the costs of running the business and to provide a return to investors. Without a sufficient rate of return, the firm will struggle to remain viable in the long term. While paying dividends and creating customer loyalty are important factors, they alone are not enough to ensure the long-term success of the firm. Balancing the interests of stakeholders is also important, but again, it is not as critical as earning a rate of return that covers the cost of capital.

For a Firm to Survive Over the Long Term It