JOURNAL OF APPLIED BUSINESS AND ECONOMICS
Allocating Capital Within A Firm
Author(s): Prakash Deo
Citation: Prakash Deo, (2017) "Allocating Capital Within A Firm," Journal of Applied Business and Economics, Vol. 19, Iss.1, pp. 20-34
Article Type: Research paper
Publisher: North American Business Press
Abstract:
A firm must direct its resources where it can capitalize on market opportunities that offer the maximum long-term returns for its shareholders. The officers of a corporation and the board of directors cannot possibly evaluate the merits of each project, which would require a myriad of data from the business case for each project. By and large, the current literature is concerned less with managerial issues associated with resource allocation or capital budgeting at the firm level than with project oriented decision about resource allocation/capital budgeting. This article is an attempt to define in practical terms the issues of resource allocation and specifically capital budgeting at the business unit and the firm level.