Capital Budgeting is the process of making financial decisions regarding investing in long-term assets for a business. It involves conducting a thorough evaluation of risks and returns before approving or rejecting a prospective investment decision. This process is also known as investment appraisal. Capital budgeting decisions are a part of the overall financial management process for a firm.
Decisions like constructing a new factory, purchasing heavy machinery for production or making a significant investment in an outside business entity are examples of Capital Budgeting. Below is a list of multiple-choice questions and answers on Capital Budgeting to help students understand the importance of this process in a company’s overall decision making. Answer: d Answer: c
Answer: c
Answer: a
Answer: b
Answer: d
Answer: c
Answer: d
Answer: a
Answer: a
Answer: d
Answer: a
Answer: a
Answer: a
Answer: d
Answer: a
Answer: c
Answer: a
Answer: b
Answer: b Also See:
Which of the following statements regarding capital rationing is true?Correct. Capital rationing occurs when a business does not have the capital necessary to fund allacceptable projects is the most correct statement about capital rationing.
Which of the following statements about capital rationing is most correct?Which of the following statements about capital rationing is most correct? Capital rationing occurs when a business does not have the capital necessary to fund all acceptable projects.
What are capital rationing decisions?What Is Capital Rationing? Capital rationing is the process through which companies decide how to allocate their capital among different projects, given that their resources are not limitless. The main goal is to maximize the return on their investment.
Which of the following would be considered a capital asset?Capital assets are significant pieces of property such as homes, cars, investment properties, stocks, bonds, and even collectibles or art.
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