$111$ point

Your company is considering implementing a cost$-$cutting measure that involves significant downsizing of the research and development

$($R&Didepartment. The cash flow analysis shows a positive outcome due to reduced labor costs. However. R&D is a key component of your company's

innovation and competitiveness in the market.

Question: Based on this scenario, what is the most appropriate conclusion to draw from the cash flow analysis?

Increase the downsizing beyond the R&D department to maximize positive cash flow.

Conduct further analysis to determine the potential long$-$term impacts of R&D downsizing on the company's market position and innovation

capabilitles, in addition to the immediate financial benefits

Implement the downsizing immediately as the positive cash flow analysis indicates clear financial benefits.

Reject the downsizing plan as it could harm the company's ability to innovate and stay competit ive. despite the positive cash flow.