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Question : 13
Total: 39
Match the factors affecting fixed capital requirements given in the Column-I with their explanations given in Column-II:
| Column-I | Column-II | ||
|---|---|---|---|
| (A) | Nature ofBusiness | (i) | A trading organisation needs lower investments in fixed assets as compared to a manufacturing organisation. |
| (B) | Technology upgradation | (ii) | A textile manufacturing company is installing a cement manufacturing plant and thus its investments in fixed assets is increasing. |
| (C) | Diversification | (iii) | A capital-intensive organisation requires higher investments in fixed assets as compared to labourintensive organisation. |
| (D) | Choice of Technique | (iv) | Mobile phones became obsolete faster and are replaced much sooner than furniture or many other assets. Hence, these type of businesses require more fixed capital. |
Solution:
(a) A- (i), B-(iv), C-(ii), (D)-(iii)
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