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MCQ Detailed View

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1 FINANCE MCQS

The set of projects or investments that maximizes the firm’s value is called ____________?

  • Minimum capital budget
  • Optimal capital budget
  • Maximum capital budget
  • Greater capital budget
Correct Answer: B. Optimal capital budget

Detailed Explanation

In capital budgeting, the optimal capital budget is the combination of projects that maximizes the overall value of the firm while considering available resources and cost of capital. It ensures that the company selects the most profitable projects without exceeding financial constraints.

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