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Juli2301 [7.4K]
1 year ago
7

Julia started a cake decorating business last year. Unfortunately, it failed quickly. She is convinced that she lacked the neces

sary funds to promote her business and get it off the ground. What did Julia experience
Business
1 answer:
sveta [45]1 year ago
7 0

Julia started a cake decorating business last year. Unfortunately, it failed quickly. She is convinced that she lacked the necessary funds to promote her business and get it off the ground. Julia experience undercapitalization.

<h3>Undercapitalization</h3>

Undercapitalization means that a company does not have enough capital to conduct ordinary business operations. Undercapitalization may also lead to the company being unable to pay its creditors.

There are several different causes of undercapitalization, including:

  • Financing growth with short-term capital, rather than permanent capital.
  • Failing to secure an adequate bank loan at a critical time.
  • Failing to obtain insurance against predictable business risks.
  • Adverse macroeconomic conditions.

To learn more about undercapitalization visit the link

brainly.com/question/1154538

#SPJ4

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