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Sagot :
Answer:
generates positive cash flows over and above its internal requirements, thus providing a corporate parent with cash flows that can be used for financing new acquisitions, investing in cash hog businesses, funding share buyback programs, and/or paying dividends.
Explanation:
In Economics, a cash cow business produces large internal cash flows over and above what is needed to build and maintain the business. On the other hand, the internal cash flows of a cash hog business are too small to fully fund its operating needs and capital requirements.
Hence, a cash cow type of business generates positive cash flows over and above its internal requirements, thus providing a corporate parent with cash flows that can be used for financing new acquisitions, investing in cash hog businesses, funding share buyback programs, and/or paying dividends. Some examples of cash cow businesses are coca-cola, kellogg's corn flakes, Apple's iPhone, Microsoft Windows, Ford trucks, etc.
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