Practicing Success

Target Exam

CUET

Subject

Business Studies

Chapter

Financial Management

Question:

Identify one statement among the following that is NOT true about capital budgeting:

Options:

These decisions are very crucial for any business since they affect its long run earning capacity 

The size of assets, profitability and competitiveness are all affected by these decisions

These are concerned with levels of cash, inventory and recievable

These decisions are irreversible except at a huge cost.

Correct Answer:

These are concerned with levels of cash, inventory and recievable

Explanation:
Short-term investment decisions (also called working capital decisions) are concerned with the decisions about the levels of cash, inventory and receivables.