A fiRm Which Is Faced with Hard Rationing

question 75

Multiple Choice

A firm which is faced with hard rationing:

• A) Has more capital funds available than it has positive net present value projects and thus must decide what to do with the excess funds.
• B) Allocates a fixed amount of capital funds to each of its divisions on an annual basis.
• C) Must decide how to allocate its limited capital funds among numerous positive net present value projects.
• D) Must decide how to allocate its limited capital funds among various business units.
• E) Has no capital funds available to finance a positive NPV project.

---

Definitions:

Ventromedial Hypothalamus

A part of the hypothalamus that plays a role in satiety, or feeling full after eating, and regulating part of the body's energy balance.

Leptin

A hormone produced by fat cells that helps to regulate energy balance by inhibiting hunger.

Cholecystokinin

A hormone released by the small intestine that stimulates the digestion of fat and protein, and also acts as a satiety signal to the brain.

Fat Cells

Cells that specialize in storing energy as fat, known scientifically as adipocytes, playing a significant role in metabolism and energy balance.