Why Is It That a Firm Will Typically Not Pay

question 11

Multiple Choice

Why is it that a firm will typically not pay for general training?

• A) General training is free.
• B) General training is expensive.
• C) The benefits of general training depreciate quickly.
• D) General training does not increase worker productivity.
• E) The skills gained from the general training are transferable to other firms.

---

Definitions:

Discount Rate

The interest rate used to discount future cash flows to their present value, often used in the valuation of investments or projects.

NPV

Net Present Value, a calculation used to assess the profitability of an investment or project, considering the time value of money.

Target Company

A firm that another company seeks to acquire.

Cost of Equity

The return that shareholders require for investing in a company's equity, representing the compensation the market demands in exchange for owning the asset and bearing the risk of ownership.