An optimal procedure for organizations to accept projects is to specify a return on investment (ROI) and fund only projects that meet this criterion. A. True B. False



False

Explanation:

Capital budgeting is needed in any project work as it entails the process and procedures taken in evaluation and selection of long-term investments that are consistent with the firm's goal of maximizing owner's wealth.

Normally, before a company invest or undergo any project, background work is done to know if the project will yet profit or no, feasibility study is carried out and things are put in place. If it is favourable for the firm and profit is high, firms may choose to invest after weighing the pros and cons (advantage and disadvantage) of the project before investment. So return of investment initial investment is not really considered when taking up a project as all project is done at their own risk.

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