Question

(Consider This) Which of the following statements is true about U.S. firms?

A. Over half are bankrupt within the first two years after starting up.
B.Over half are bankrupt within the first five years after starting up.
C. Nearly 65 percent last 10 years or more.
D. The life expectancy of a U.S. firm is approximately 22 years.

Answer 1

The correct answer is letter "B": Over half are bankrupt within the first five years after starting up.

Step-by-step explanation:

Under the Bankruptcy Code, U.S. companies and individuals can file for bankruptcy and it is considered a legal process. In the second quarter of 2019, almost 23 000 companies filed for bankruptcy. There is an average of 44 500 firms that had to be liquidated from 1980 until 2019. According to the same tendency, most of those start-ups file for bankruptcy after the first 5 years of operations.