An Investment Has an Initial Cost of $300,000 and a Life

question 67

Multiple Choice

An investment has an initial cost of $300,000 and a life of four years.This investment will be depreciated by $60,000 a year and will generate the net income shown below.Should this project be accepted based on the average accounting rate of return (AAR) if the required rate is 9.5 percent? Why or why not?

• A)Yes, because the AAR less than 9.5 percent
• B)Yes, because the AAR is 9.5 percent
• C)Yes, because the AAR is greater than 9.5 percent
• D)No, because the AAR is 9.5 percent
• E)No, because the AAR is greater than 9.5 percent

Understand the function and importance of business incubators and accelerators in supporting new businesses.

Grasp the global trends in research and development (R&D) spending, its contributors, and geographical variances.

Analyze the challenges faced by global firms due to the integration of technology in business, including data security and infrastructure distribution.

Distinguish between different skills shortage scenarios and their implications on organizations and nations.

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Definitions:

Stepwise Regression

A method of regression analysis in which the choice of predictive variables is carried out by an automatic procedure, often involving the selection of variables based on statistical criteria.

Independent Variables

Variables in statistical models that are manipulated or categorized to observe their effect on dependent variables.

Quantitative Predictor Variables

Variables that can be quantified and measured and are used to predict outcomes in statistical analyses.

Indicator Variables

Variables used in statistical models that take the value of 1 if a certain condition is met and 0 otherwise, often used to represent categorical data.