Which One of the Following Is the Minimum Required Rate

question 62

Multiple Choice

Which one of the following is the minimum required rate of return on a new investment that makes that investment attractive?

• A)Risk-free rate
• B)Market risk premium
• C)Expected return minus the risk-free rate
• D)Market rate of return
• E)Cost of capital

---

Definitions:

Fixed Cost

Expenses that do not change with the level of production or sales activities, such as rent, salaries, and insurance premiums.

Screen Printing

A printing technique where a mesh is used to transfer ink onto a substrate, except in areas made impermeable to the ink by a blocking stencil.

Break-even Point

The point at which total costs and total revenue are equal, resulting in no net gain or loss for a business.

Contribution Margin

Contribution margin is the amount of revenue remaining after deducting the variable costs of producing a product, indicating how much contributes to covering fixed costs and generating profit.