The Biggest Problem in Implementing a Utilitarian Approach to Decision

question 86

Multiple Choice

The biggest problem in implementing a utilitarian approach to decision making is:

• A) The interests of others may be subservient to self-interests
• B) It fails to consider the interests of others
• C) It can be difficult to weigh all the consequences of actions
• D) It relies on moral absolutes

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Definitions:

Cost Of Capital

The rate of return that a company must earn on its investments to maintain its market value and attract funds.

NPV

Net Present Value, a method used in capital budgeting to evaluate the profitability of an investment or project.

Beta

A measure of the volatility, or systematic risk, of a security or a portfolio in comparison to the market as a whole, where a beta greater than one indicates higher than market volatility and less than one indicates lower.

Security Market Line

The Security Market Line graphically represents the expected return of assets as a function of their systematic, non-diversifiable risk.