Early in a period in which sales were increasing at a modest rate and plant expansion and startup costs were occurring at a rapid rate, a successful business would likely experience
1. Increased profits and increased financing requirements because of an increasing cash shortage.
2. Increased profits and decreased financing requirements because of an increasing cash surplus.
3. Increased profits and no change in financing requirements.
4. Decreased profits and increased financing requirements because of an increasing cash shortage.
5. Decreased profits and decreased financing requirements because of an increasing cash surplus.