The Objective of Capital Rationing Is to Select the Group

question 93

True/False

The objective of capital rationing is to select the group of projects that provides the highest overall net present value and does not require more dollars than are budgeted.

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Definitions:

Least Possible Cost

The minimum expense required to achieve a particular economic objective.

General Equilibrium

A situation in which supply and demand are balanced across all markets in the economy.

Simultaneously Equilibrium

A condition in which demand and supply are balanced at the same time across multiple markets or within a complex system.

Capital Flow

The movement of money for the purpose of investment, trade, or business production between countries.