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In which situation would it be wise to stop expanding an enterprise?

Answer and explanation

Correct answer: When current operations are unstable and cash is weak

Expansion usually requires additional working capital, people, equipment, and management attention. If current operations are unstable and cash is weak, expansion can increase fixed commitments before the existing business is under control. The entrepreneur should first improve cash flow, process reliability, and operational performance. Stable demand, trained staff, and clear processes generally provide stronger conditions for carefully planned expansion.

Related tags

Business-ExpansionCash-FlowBusiness RiskBusinessTrade And CommerceBusiness Trade And CommerceBusiness StudiesClass 11 Mcq

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