Cash Flow Is an Important Concept to Consider for a New

Multiple Choice

Cash flow is an important concept to consider for a new venture for which of the following reasons?

A) Despite being profitable, a growing business can run out of cash and fail as a result.
B) Sales revenue is an important indicator of market success but profitability is what keeps the cash flowing.
C) In the early stages, investors are more concerned about the venture's profitability than its liquidity.
D) Profitability is a much easier concept to monitor than cash flow.
E) None of the answers apply.