The Importance of Capital Budgeting Decisions Is Due to All

question 101

Multiple Choice

The importance of capital budgeting decisions is due to all of the following factors except for:

• A) the impact of a capital budgeting decision is long term;the firm loses some decision-making flexibility when capital projects are purchased.
• B) effective capital budgeting can improve the timing of asset acquisition and the quality of assets purchased.
• C) the acquisition of fixed assets typically involves substantial expenditures,and before a firm spends a large amount of money,it must have the funds available.
• D) capital budgeting techniques overcome the problems with error in forecasts for asset requirements and projected sales,we will still be able to determine if we should fund the project.
• E) all of the above are factors that make capital budgeting important.

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