When a firm chooses to buy new fixed assets it is making a ______________ decision.

A) capital budgeting
B) capital structure
C) financing
D) working capital
E) dividend policy

Capital Budgeting

The process of evaluating and selecting long-term investments that are consistent with the firm's goal of wealth maximization.

Fixed Assets

Long-term assets used in the operation of a business, not expected to be converted into cash within a year, such as buildings and machinery.