Soft Capital Rationing May Be Beneficial to a Firm If

question 111

Multiple Choice

Soft capital rationing may be beneficial to a firm if it:

• A) reduces a firm's interest expense.
• B) weeds out proposals with weaker or biased NPVs.
• C) allows managers to select their favorite projects.
• D) increases funds to be used for other purposes.

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Definitions:

Trend Projection

A forecasting technique that involves analyzing historical data to identify consistent results or directions over time.

Linear Regression

A statistical method used to model the relationship between a dependent variable and one or more independent variables.

Independent Variable

A variable in an experiment or model that is manipulated or changed to observe its effects on a dependent variable.

Seasonal Index

A numerical value or coefficient that adjusts data for seasonal variations, making trends clearer over time.