Why Do Businesses Often NOT Pursue the Best Mix of Projects

question 2

Multiple Choice

Why do businesses often NOT pursue the best mix of projects in their project portfolio?

• A)Projects are selected based on criteria that are not always consistent with the business strategy.
• B)Businesses do not use enough financial metrics in selecting projects.
• C)Too much emphasis is placed on feasibility.
• D)Selection committees neglect to use a portfolio value matrix.

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Definitions:

Reserve Requirement

The mandatory percentage of deposits that banks must hold in reserve, either in their vaults or at the central bank, not available for lending.

Government Bond

A debt security issued by a government to support government spending and obligations, typically offering a fixed rate of return.

Money Supply

The comprehensive amount of money assets found in an economy at a noted time.

Checking Accounts

Bank accounts that allow for both deposits and withdrawals, enabling easy access for daily transactions.