The best definition of capital budgeting is:
A) The possibility of conflicts between shareholders and management in a large corporation.
B) The process of planning and managing a firm's long-term investments.
C) Financial markets where long-term debt and equity securities are bought and sold.
D) The purchase or sale of securities whose value derives from the price of another, underlying, asset.
E) The annual process of providing a benchmark for financial performance.

Question

Quizplus · Accepted Answer

Capital budgeting refers to the process through which a business evaluates and plans for its long-term investments, such as purchasing new machinery, acquiring new businesses, or launching new products. It involves assessing the potential returns on these investments to ensure they align with the company's strategic goals and financial capacity.

The Best Definition of Capital Budgeting Is