Company A has received requests for capital investment funds for next year from each of its five divisions. All requests represent positive net present value projects. All projects are independent. Senior management has decided to allocate the available funds based on the profitability index of each project since the company has insufficient funds to fulfill all of the requests. Management is following a practice known as:

A.	scenario analysis.

B.	sensitivity analysis.

C. leveraging.

D. soft rationing.

E. hard rationing.

Answer rating: 100% (QA)

The detailed answer for the above question is provided below The correct answer is E hard rationing ... View the full answer