GlaxoSmithKline's Spending of $6 Billion in 2012 on Research and Development

question 57

True/False

GlaxoSmithKline's spending of $6 billion in 2012 on research and development of new drugs is a capital budgeting decision but not a financing decision.

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Definitions:

Price/Earnings Ratio

A valuation ratio of a company's current share price compared to its per-share earnings, indicating the dollar amount investors will pay for $1 of earnings.

Investors

Individuals or entities that allocate capital with the expectation of receiving financial returns.

Global Event Factors

External events and developments that can influence financial markets and economic conditions worldwide, including political, environmental, and economic changes.

Economy-Wide Factors

Broad macroeconomic factors that affect the economic framework within which firms and industries operate, including inflation rates, interest rates, and overall economic growth.