Capital rationing

Definition:

Placing limits on the amount of new investment undertaken by a firm, either by using a higher cost of capital, or by setting a maximum on the entire capital budget or parts of it.

Investing Essentials


Copyright © 2011 Campbell R. Harvey, Professor of Finance, Fuqua School of Business at Duke University

Term of the Day

Snake

Arrangement established in 1972, that ties European currencies to each other within specified limits.

Subscribe to the Term of the Day via email Get the Term of the Day in your inbox!


Create your free portfolio