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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Definitions:

Quality Leadership

A management approach that emphasizes excellence in products and services through leadership commitment and continuous improvement practices.

Competing on Differentiation

A strategy where businesses aim to distinguish their products or services from competitors through unique features, quality, or service.

Mass Production

The manufacture of large quantities of standardized products, often using assembly lines or automated technology.

Experience Differentiation

Engaging a customer with a product through imaginative use of the five senses, so the customer “experiences” the product.