Answer :
Capital allocation is the process by which companies determine which investment opportunities make the most sense to them. A typical goal of capital allocation is to direct a company's limited capital resources to the most profitable projects.
Capital allocation is the process of determining the most efficient strategy for investing an organization's financial resources with the goal of maximizing shareholders' equity.
Capital allocation is the allocation, reallocation and investment of financial resources to maximize the interests of stakeholders. It is a strategic financial decision made by CEOs and CFOs that is critical to the long-term success of the company.
An example of capital allocation for an acquisition is the acquisition of a company. Alternatively, company management may choose to merge with another company or spin off a business unit to generate cash that can be better spent elsewhere.
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