The following table contains Emerald Corp.'s quarterly revenues, in thousands, for the past three years. During that time, there were no major changes to Emerald's selling strategies and total capital investment. | 1st Qtr. | 2nd Qtr. | 3rd Qtr. | 4th Qtr. |
|---|
| Year 1 | $ 500 | $ 500 | $ 550 | $ 750 | | Year 2 | 525 | 550 | 600 | 800 | | Year 3 | 550 | 525 | 625 | 850 |
Which of the following statements best describes the likely cause of the fluctuations in Emerald's revenues and the best response to those fluctuations?
|
a. | The fluctuations are from the seasonal demand for Emerald's products, and Emerald should manage its inventories and cash flow to match the cycle. | |
b. | The fluctuations are from changes in the economy, and Emerald should examine its cost structure for potential changes. | |
c. | The fluctuations are from the seasonal demand for Emerald's products, and Emerald should examine its cost structure for potential changes. | |
d. | The fluctuations are from changes in the economy, and Emerald should manage its inventories and cash flow to match the cycle. |
|
