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Use the figure below to answer the following questions. Figure 15.3.1
-Refer to Figure 15.3.1.The figure shows the marginal private benefit curve,the marginal social benefit curve,and the market supply curve.If a voucher is given to consumers that generates an efficient outcome,then producers receive a price of
Average Accounting Return
A measure used to evaluate the profitability of an investment, calculated as the average annual profit divided by the initial investment cost.
Payback Period
The length of time it takes for an investment to recover its initial outlay of cash, through income or savings.
Profitability Index
A calculation that determines the relationship between the costs and benefits of a proposed project through a ratio derived from present value of future cash flows divided by initial investment.
Net Present Value
An analysis that assesses the worth of a project or investment by comparing all incoming and outgoing cash flows against a discount rate.
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