A Project That Just Breaks Even on a Cash Basis

question 372

Multiple Choice

A project that just breaks even on a cash basis _________________.

• A) Does not pay back.
• B) Will exactly pay back by the end of the project.
• C) Will pay back prior to the end of the project.
• D) Has an IRR equal to 0 %.
• E) Has a profitability index of 2.

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Definitions:

Limited Partnership

A business structure where at least one partner is liable only to the extent of their investment in the company, while at least one other partner has unlimited liability.

Management Responsibilities

The duties and tasks associated with directing and controlling an organization or one of its units.

Invest

The act of allocating resources, usually money, with the expectation of generating an income or profit.

Franchise Agreements

Franchise agreements are legal contracts between a franchisor and franchisee, outlining the terms for the franchisee to operate a franchised business.