Which of the Following Investment Evaluation Techniques Used in Capital

question 9

Multiple Choice

Which of the following investment evaluation techniques used in capital budgeting is based on the discounted cash flow model?

• A)Accounting rate of return
• B)Internal rate of return
• C)Payback
• D)Both B and C

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Definitions:

Fixed Overhead

Costs that do not vary with the level of production or sales, such as rent, salaries, and insurance.

Special Offer

A promotional deal or discount aimed at encouraging consumers to buy a product or service.

Direct Materials

The raw materials that can be directly traced to the manufacturing of a product.

Remachine

The process of reworking or refurbishing a piece of machinery to restore its functionality or improve its performance.