A Firm's Capital Expenditures May Be Limited Due to Externally

Multiple Choice

A firm's capital expenditures may be limited due to externally imposed constraints. All of the following are external constraints EXCEPT:

A) The firm's loan agreements may contain restrictive restraints.
B) The firm may decide to place an upper limit on the amount of funds allocated to capital investment.
C) If the firm has a weak financial position, it may be too expensive to float a new bond issue.
D) There may be market-imposed difficulties such as a tight money policy of the part of the Federal Reserve System.