Question

Causes and effects and remidies for overcapitalization

Answer 1

The opposite of overcapitalization is undercapitalization, which occurs when a company has neither the cash flow nor the access to credit that it needs to finance its operations.

Undercapitalization most commonly occurs in companies with high start-up costs, too much debt and insufficient cash flow

Answer 2

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Over-Capitalisation: Meaning, Causes, Consequences and Remedies .... Effect of over-capitalisation on company is disastrous.