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This entails the selection of appropriate technology, and plant and machinery which ensure
efficient and
economical operations. Technology must be chosen on the basis of specific requirements of
the
enterprises. Technology must be chosen on the basis of specific requirements of the
enterprise. A very
important decision in the area of plant and machinery refers to the size or capacity of the
facilities to be
created.
SOUND FINANCING
An entrepreneur generally approaches financial institutions for the loan on the basis of the
cost estimates
of the project. If there is any cost over - run, the entrepreneur would find it difficult to raise
the extra
time over run thereby affecting all estimates of funds flow too.
The following are the essential elements of the project cost :-
Land & site development
Building & civil works
Plant & machinery
Engineering fee for acquisition of technology