Answer:
The correct answer to the question is OPTION D (Negative or positive cash flows from operations, negative cash flows from investing, and positive cash flow from financing).
Explanation:
The product life cycle of a company generally talks about the marketing aspect of a product and strategies to ensure the product from manufacturing excel in the market. There are for phase: Introduction, growth, maturity, and decline.
After the product is unveiled to the public, the growth phase is the next as it shows how the product gain in the market. In this phase, the company has been able to win a lot of trust from consumers, this is evident with an increase in sales of the product and overall profit registered by the company.
The cash flow from a product is either positive or negative depending on the stage the product is in the growth phase. However, positive cash flow will occur as soon as sales start to peak and overall acceptance of the product.
Running operations could either have a positive or negative cash flows depends on the differences in revenue, expenses, and how the company finance operations.
Negative cash flows from investing occur during the growth phase because the company continues to invest, buy assets, pay loans, and do other activities.
Positive cash flows from financing during the growth phase of the new product means the company is gaining more asset and gaining more money than they are spending.
