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Knowing how much cash is needed in the bank for the first few months when the business first opens refers to _____.

a. listing what will be spent on items needed to start the business
b. listing what will be spent on expenses to start the business
c. determining how much money is needed to get started
d. none of the above

User Dexto
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Final answer:

The correct answer is 'c. determining how much money is needed to get started', which involves planning for the initial financial requirements and future monetary needs for a new business, including creating a budget and securing sufficient funding.

Step-by-step explanation:

The correct answer to the student's question is 'c. determining how much money is needed to get started'. This refers to the process of identifying the total capital required to cover the initial operational expenses and to maintain a cash reserve for the business during its early stages. This will include costs such as rent, utilities, salaries, and other overheads before the business generates a steady income.

It's crucial for entrepreneurs to be proactive in budgeting and to forecast their financial needs. Often, business owners must tap into personal savings, or secure funding through loans or from angel investors. Proper financial planning ensures that a business can sustain operations until it becomes profitable, a practice that is indispensable for short- and long-term success.

User Chiradeep
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