Which of the following is a potential use for excess cash within a company?

Using excess cash to acquire another company for growth is a strategic move that businesses often consider. This approach allows a company to expand its operations, enter new markets, gain access to new technologies, or enhance its product offerings. By utilizing available cash for acquisitions, a company can leverage its financial resources to create additional value and potentially increase its market share.

This strategy contrasts with merely paying down debt, which, while it does strengthen the balance sheet, may not necessarily contribute to growth. Maintaining minimal cash reserves is a more conservative approach that overlooks the potential benefits of strategic investments. Similarly, increasing liabilities does not generally utilize cash effectively and could expose the company to more financial risk. Thus, investing in acquisitions represents a proactive use of excess cash aimed at driving growth and enhancing company value.