What is the primary goal of capital budgeting?
Options
ATo maximize shareholder wealth
BTo minimize risk
CTo optimize liquidity
DTo reduce costs
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Capital Budgeting & Portfolio ManagementMCQQuestion 5762 of 6
All Questions Correct Answer
✅ Option A — To maximize shareholder wealth
All Options:
- ATo maximize shareholder wealth ✓
- BTo minimize risk
- CTo optimize liquidity
- DTo reduce costs
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Detailed Solution & Explanation
The primary goal of capital budgeting is to maximize shareholder wealth. This is achieved by evaluating investment projects and selecting those that are expected to generate the highest returns, while also considering the risk associated with each project. The selected projects should align with the company's overall strategy and contribute to its long-term growth and profitability.
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More Questions from Capital Budgeting & Portfolio Management
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