Practicing Success

Target Exam

CUET

Subject

Business Studies

Chapter

Financial Management

Question:
"Burger King plans to open a new chain store due to rising demand in Delhi". Name the type of decision indicated in the given statement.
Options:
Dividend decision
Investment decision
Financing decision
All of the above
Correct Answer:
Investment decision
Explanation:
Fixed capital refers to investment in long-term assets. Management of fixed capital involves allocation of firm’s capital to different projects or assets with long-term implications for the business. These decisions are called investment decisions or capital budgeting decisions and affect the growth, profitability and risk of the business in the long run. These long term assets last for more than one year.