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प्रश्न
Explain the following as factors affecting the requirements of fixed capital:
Technology upgradation
उत्तर
Technology upgradation: Due to changes in technology or it becoming obsolete over time, companies require a large amount of investment in fixed capital. For example, certain machinery becomes obsolete very soon compared to other assets such as furniture. Therefore, a larger fixed capital is required for upgradation.
Faster upgradation ⇒ Higher investment in fixed assets
Slower upgradation ⇒ Lower investment in fixed assets
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संबंधित प्रश्न
Explain the following as factor affecting the requirements of fixed capital:
Scale of operations
Explain the following as factor affecting the requirements of fixed capital:
Choice of technique
Explain the following as factors affecting the requirements of working capital:
Scale of operations
Explain the following as factors affecting the requirements of working capital:
Seasonal factors
Explain the following as factors affecting the requirements of working capital:
Production cycle
Varunica Ltd., a reputed truck manufacturing company, needs rupees twenty crores as additional capital to expand its business. Mr. Alind Jindal, the CEO of the company, wants to raise funds through equity. The Finance Manager, Mr. Nikhil Sachdeva, suggests that the existing shareholders be offered the privilege to subscribe to new issue of shares as per the terms and conditions of the company which was agreed by Mr. Alind Jindal.
Name the method through which the company decided to raise additional capital.
State, with reason, whether the following statement is True or False.
Requirement of working capital does not depend upon any factor.
Amrit is running a ‘transport service’ and earning good returns by providing this service to industries. Giving reason, state whether the working capital requirement of the firm will be ‘less’ or ‘more’.
How does working capital affect both the liquidity as well as profitability of a business?
What is working capital? Discuss five important determinants of working capital requirement?
Fixed Capital Working Capital
What are the important determinants of working capital requirement?
Which of the following factors highlight the importance of capital budgeting decisions
Dhaval Acharya, after acquiring a bachelor’s degree in Hotel Management joined his father’s chain of vegetarian restaurants in Ahmednagar. Being young and enterprising, he suggested his father to add a new section of vegetarian bakery items which required an investment of ₹ 5 crores. His father Mr. Aariketh Acharya suggested him to take the decision with caution and understood everything comprehensively as bad decision may damage the financial fortune of business.
Identify the decision suggested by Mr. Aariketh Acharya. State by giving any three reasons as to why he must have advised his son to take decision with caution.
A business firm should have extra funds to meet future emergencies. Identify the type of working capital indicated here.
