General Studies · Capital Requirements and Planning
Given below are two statements: one is labelled as Assertion A and the other is labelled as Reason R. Assertion A: The estimation of capital requirements in financial management necessitates the projection of both fixed capital for long-term assets and working capital for day-to-day operations. Reason R: Precise forecasting of these capital components is required to protect the enterprise from the inefficiencies of under-capitalisation and over-capitalisation. In the light of the above statements, choose the most appropriate answer from the options given below:
Verified Solution4 OptionsUpdated: October 2026👁️1 View
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- 1Both A and R are correct but R is NOT the correct explanation of A
- 2Both A and R are correct and R is the correct explanation of A✓
- 3A is correct but R is not correct
- 4A is not correct but R is correct
Correct answer
Both A and R are correct and R is the correct explanation of A
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