Borrowing to pay for long-term capital expenditures makes sense as the benefits are received:

Question

Quizplus · Accepted Answer

Long-term capital expenditures are typically investments in assets that provide benefits over many years. It makes sense to borrow to pay for these expenses because the benefits are spread over a long period of time. By spreading the cost of the expense over the same period of time, the burden of paying for them is also spread out, making it more manageable financially. Option B is the best choice because it correctly identifies that the benefits are received over many years so the burden of paying for them should also be spread over many years.

Borrowing to Pay for Long-Term Capital Expenditures Makes Sense as the Benefits