--%>
Assignment Help - homework help

Drawbacks of capital budgeting

Write down the drawbacks of capital budgeting?

E

Expert

Verified

Capital budgeting drawbacks are illustrated below :-
   
i) It has long term executions which cannot be employed in short term and it is employed as operations of the business. An incorrect decision in the early stages can influence the long-term stability of the company. The operating cost gets raised when the investment of fixed assets is more than necessary.

ii) Inadequate investment makes it hard for the company to raise it budget and the capital.

iii) Capital budgeting engages huge number of funds so the decision has to be taken cautiously.

iv) Decisions in capital budgeting are not adjustable as it is difficult to locate the market for capital goods.

   Related Questions in Business Economics

  • Q : Illustrate other than price many factors

    Illustrate other than price many factors determine the outcome?

    		•
  • Q : Theory of wages according to Adam Smith

    Least consistent along with Adam Smith’s theory of wages would be the suggestion that wages vary positively along with the: (w) effort required to learn skills necessary to accomplish particular types of work. (x) stability of employment and the

    		•
  • Q : State of good or service at last unit

    Which of the given describes a situation in which each good or service is produced up to the point where the last unit gives a marginal benefit to consumers equivalent to the marginal cost of producing this? w) productive efficiency.

    		•
  • Q : Circular flow model to confirm this

    Use the circular flow model to confirm this assertion for the construction of a new high school in Blackhawk county?

    		•
  • Q : Market efficiency while transaction

    Transaction costs tend to be decreased and markets are more efficient when: (w) the government subsidizes a good. (x) inter-market price differentials are eliminated through arbitrage. (y) taxes are used to give for social wants. (z) regulations close

    		•
  • Q : Limitation of building blocks for a

    Building blocks for a capitalist system would not consist of: (1) supplies and demands. (2) private property rights. (3) laissez-faire policies. (4) market-found prices and outputs. (5) distribution of income in accord along with the principle, &ldquo

    		•
  • Q : Illustrate the 3rd the government

    Illustrate the 3rd the government redistributes income?

    		•
  • Q : Freely Floating Currency Question: For

    Question: For a freely floating currency, currency i.____________________ occurs when the market value of a country's currency rises relative to the value of another country's currency, while currency ii.__________

    		•
  • Q : Describe the types of multiplant firms

    Describe the types of multiplant firms?

    		•
  • Q : Comparative advantage in production I

    I have a problem in economics on Comparative advantage in production. Please help me in the following question. The oranges are grown in Florida and potatoes are grown in Maine mainly since: (i) orange-grower’s in Maine have not lobbied effectiv

    		•