Question

In case of materials the key factor may be _________.

• A. Insufficient advertising
• B. Restrictions imposed by quota
• C. Low market demand
• D. None of these

Answer 1

The correct option is B Restrictions imposed by quota

Key factor or limiting factor is an important criteria while preparing the budget. If the raw material is a limiting factor, the budget has to planned in such a way that the organization will get maximum benefits while using the available raw material.

When the availability of raw material is a limiting factor, it means there is a quota fixed by the government as there is shortage of raw material.