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Consequences of financial distress in a firm under a globalized economy?

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The overall economy has gone through very difficult times lately. Financial distress impacts firms at their micro level and creates unprecedented challenges for them. Setting and implementing financial strategies is more important than ever. Mechanisms to deal with financial distress include:
- asset restructuring,
- debt restructuring,
- enhancing the ability to enforce debt obligations,
- mergers between firms, where at least one of the parties is having difficulty independently staying afloat,
- reduction in employment level.

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