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Who imposes the limit on capital funds for soft rationing?Multiple ChoiceInvestorsBanksTop managementCorrectStock market

Question

Who imposes the limit on capital funds for soft rationing?

Multiple Choice

  • Investors
  • Banks
  • Top management
  • Stock market
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Solution

The limit on capital funds for soft rationing is typically imposed by top management. This is because top management is responsible for setting financial policies and guidelines that dictate how much capital can be allocated within the organization. They evaluate the overall strategic goals of the company and make decisions that align with those goals, which includes determining the limits on capital expenditures.

In contrast, investors and banks may influence financial decisions, but they do not directly impose limits on capital funds within a company. The stock market reflects the performance of publicly traded companies but does not set internal capital funding limits.

Overall, the correct answer to this multiple-choice question is Top management.

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