Competitive market forces make it imperative for a firm to have a systematic strategy for generating capital-budgeting projects.

Question

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In a competitive market, firms need to continually invest in capital projects to stay ahead of the competition. Without a systematic strategy for generating and evaluating potential projects, a firm may miss out on opportunities to improve their products, reduce costs, or expand their reach. Thus, it is crucial for firms to have a well-defined capital budgeting process.

Competitive Market Forces Make It Imperative for a Firm to Have