Question

In regards to financial management, how will Apple parting ways with Intel affect Intel's capital budget?

Answer 1

if the Apple is parting ways with the Intel, then the capital budget of the Intel will be affected as follows-

A. Allocation of the intel will be lesser into the new projects

B.the risk exposure of Intel would be reducing significantly because of the risk exposure of the Apple getting out.

C. The long-term profitability and viability of the business has completely changed because of opting out which has been done by the Apple.

D.there would be a different weighted average cost of capital which will be allocated to the capital budgeting projects by Intel.

E. Risk weighting ofof the various projects of Intel has subsequently changed.

so it can be said that there would be readjustment in the capital budgeting process of Intel after Apple has opted out.