With an Unlimited Amount of Funds,a Firm Could Accept All

question 16

Essay

With an unlimited amount of funds,a firm could accept all positive NPV projects.However,with limited budgets,managers are forced to accept some positive NPV projects while rejecting others.What overall financial rule should managers follow when choosing the portfolio of projects to accept? Why?

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Definitions:

World War II

A global conflict that lasted from 1939 to 1945, involving most of the world's nations and marked by significant battles and events shaping modern history.

Great Depression

A severe worldwide economic downturn that took place during the 1930s, marked by high unemployment, deflation, and widespread poverty.

Middle-Class

A social group between the upper and working classes, including professionals, managers, and small business owners, often characterized by moderate to high income levels and educational attainment.

Housewives

Women who choose to not take formal employment outside the home, instead focusing on managing household responsibilities and care of family members.