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What is one of the disadvantages of capital rationing according to the text?
  • a)
    It maximizes value creation for companies.
  • b)
    It allows for the selection of large-scale investments.
  • c)
    It may lead to inefficient project selection.
  • d)
    It always considers intermediate cash flows.
Correct answer is option 'C'. Can you explain this answer?
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What is one of the disadvantages of capital rationing according to the...
One of the disadvantages of capital rationing mentioned in the text is that it may lead to inefficient project selection. Capital rationing restricts investment in some profitable projects, potentially missing out on opportunities to maximize value creation for the company. This is because not all profitable projects are accepted, which can result in suboptimal allocation of resources.
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What is one of the disadvantages of capital rationing according to the text?a)It maximizes value creation for companies.b)It allows for the selection of large-scale investments.c)It may lead to inefficient project selection.d)It always considers intermediate cash flows.Correct answer is option 'C'. Can you explain this answer? for B Com 2025 is part of B Com preparation. The Question and answers have been prepared according to the B Com exam syllabus. Information about What is one of the disadvantages of capital rationing according to the text?a)It maximizes value creation for companies.b)It allows for the selection of large-scale investments.c)It may lead to inefficient project selection.d)It always considers intermediate cash flows.Correct answer is option 'C'. Can you explain this answer? covers all topics & solutions for B Com 2025 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for What is one of the disadvantages of capital rationing according to the text?a)It maximizes value creation for companies.b)It allows for the selection of large-scale investments.c)It may lead to inefficient project selection.d)It always considers intermediate cash flows.Correct answer is option 'C'. Can you explain this answer?.
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