Capital BudgetingMODULE 9CAPITAL BUDGETINGTHEORIES:Basic ConceptsDecision Making Process2.The first step in the decision-making process is to A.determine and evaluate possible courses of action.B.identify the problem and assign responsibility.C.make a decision.D.review results of the decision.
Strategic planning39.Strategic planning is the process of deciding on an organization’
1.The long-term planning process for making and financing investments that affect acompany’s financial results over a number of years is referred to as
3.Capital budgeting is the process
5.A capital investment decision is essentially a decision to:A.exchange current assets for current liabilities.B.exchange current cash outflows for the promise of receiving future cash inflows.C.exchange current cash flow from operating activities for future cash inflows from investingactivities.D.exchange current cash inflows for future cash outflows.
Risk & return6.The higher the risk element in a project, the
9.Cost of capital is the
14.How should the following projects be listed in order of increasing risk?
41.Problems associated with justifying investments in high-tech projects often include discountrates that are tooA.low and time horizons that are too longB.high and time horizons that are too longC.high and time horizons that are too shortD.low and time horizons that are too short