Which action may organisations take to address lack of finance besides downsizing?

Which action may organisations take to address lack of finance besides downsizing?

• A. Invest in marketing
• B. Redundancies through downsizing
• C. Hire more staff
• D. Increase product line

Answer: (B)

When finance is tight, the priority is to reduce cash outflows to preserve liquidity. Redundancies through downsizing directly cuts ongoing costs like salaries and overhead, which lowers monthly expenses and frees up cash in the short term. This makes it easier for the organization to meet its obligations and continue operating while other recovery options are pursued. The other choices either require additional funds up front or increase costs, which would worsen the cash shortage in the near term. So, reducing costs through downsizing is the most effective immediate way to address a lack of finance among the options.

When finance is tight, the priority is to reduce cash outflows to preserve liquidity. Redundancies through downsizing directly cuts ongoing costs like salaries and overhead, which lowers monthly expenses and frees up cash in the short term. This makes it easier for the organization to meet its obligations and continue operating while other recovery options are pursued. The other choices either require additional funds up front or increase costs, which would worsen the cash shortage in the near term. So, reducing costs through downsizing is the most effective immediate way to address a lack of finance among the options.