Final answer:
The primary assumption behind choosing a liquidation strategy is that the organization cannot continue as a viable operation and is therefore better off selling its assets. This decision usually comes as a last resort after evaluating all other restructuring or merging options.
Step-by-step explanation:
The underlying assumption when selecting the liquidation strategy is d. the organization cannot be sold as a viable on-going operation. In the context of corporate strategies, liquidation typically implies that the firm has explored alternative options, such as mergers, acquisitions, or restructuring, and determined that continued operation is not feasible or potentially profitable. When a company settles on liquidation, it assumes that the enterprise can no longer maintain its operations in a sustainable or profitable manner and that divesting its assets is the most prudent course of action to mitigate losses for its stakeholders.
Firms decide on a liquidation strategy when other avenues, like attracting more customers or improving efficiency, have been considered and deemed unlikely to rectify the company's challenges. This strategic choice involves winding down business operations and selling off assets, where the proceeds are used to pay creditors, and if possible, shareholders. The decision to liquidate is often seen as a last resort when a business cannot find a market for its business as a going concern, and there is no belief or evidence to suggest that altering the business model or operational strategies would result in a turnaround.