If a firm cannot access markets sufficiently to meet their DFN, which of the following strategies might they use?

Study for the WGU FINC6000 C214 Financial Management Exam. Access multiple-choice questions and detailed explanations to gear up for your exam. Enhance your understanding and get ready to succeed!

The strategy that encompasses slowing sales growth, lowering dividend payouts, and increasing the net margin all together is applicable for a firm that cannot access markets sufficiently to meet its discretionary funding needs (DFN). Each of these actions can contribute to improving a firm's financial position.

Slowing sales growth can be a tactical decision to manage available resources more efficiently. When a firm slows its expansion, it allows for better cash flow management, which can help in maintaining operations without the immediate need for external financing.

Lowering dividend payouts is another strategic action that a firm might take. By reducing the amount of money distributed to shareholders, the firm retains more earnings within the business. This retained earnings can be used to fund operations, pay down debt, or reinvest in the business instead of seeking external financing, which may not be feasible at the moment.

Increasing the net margin focuses on improving profitability. By reducing costs or enhancing revenue, the firm can increase the amount of profit generated from its operations. A higher net margin means that for each dollar of sales, a greater percentage is retained as profit, thereby increasing the firm's cash flow without the need for additional external funding sources.

By integrating all three strategies, a firm can effectively navigate financial constraints while improving its internal funding capabilities. Therefore

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