Reasons why profits/revenues fell

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  • Created by: Tash5151
  • Created on: 16-06-16 14:58
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  • Assess reasons why profits/revenues fell
    • Selling off parts of the business before it becomes unsellable
      • Eval: if they're being sold at a loss is this a good idea
    • Price is below AVC so variable costs aren't being covered
      • Eval: External environment may change and price and profits improve
    • To raise finance to buy new companies and expand
      • Eval: may be rejected by competition authorities
    • To consolidate the business by removing inefficiencies
      • Eval: in LR profits might be made


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