The Managers in an Organization Are Responsible for Which Step

question 14

Multiple Choice

The managers in an organization are responsible for which step of the financial cycle?

• A) assessment
• B) planning
• C) execution

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Definitions:

Profitability Index

A ratio that compares the present value of future cash flows generated by an investment to the investment's initial cost, indicating its relative profitability.

Required Rate Of Return

The minimum annual percentage return an investor expects to achieve from an investment.

Discounted Payback

A capital budgeting method that calculates the length of time it takes to break even from an investment based on its discounted cash flows.

Profitability Index

A financial tool that calculates the ratio of the present value of future cash flows generated by an investment to the investment’s initial cost, used to assess project attractiveness.