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CMA Final · Strategic Financial Management · Investment Decisions, Project Planning and Control

In the capital budgeting process, which step normally comes immediately after the evaluation and selection of a proposal and before its operation begins?

Project implementation and execution follows evaluation and selection. The standard sequence is idea generation, screening, evaluation, selection, implementation, and finally performance review through post-completion audit once the project is operating.

  1. AProject implementation and executionCorrect
  2. BGeneration of investment ideas
  3. CPost-completion audit
  4. DPreliminary screening of proposals

Explanation

The usual sequence is idea generation, screening, evaluation and selection, implementation, then performance review or post-audit. Post-completion audit happens after the project is operating, so it cannot follow selection directly.

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