Which of the following factors doesn't affect the capital budgeting decisions?
Which of the following factors doesn't affect the capital budgeting decisions?
Solution
✅ Correct Option: 4
Capital budgeting (investment) decisions are affected by the cash flows of the project, the rate of return expected, and the investment criteria or technique applied. The state of the capital market influences financing and dividend decisions (e.g., choice of source, stock market reaction), not capital budgeting decisions.
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