What Is an Argument Against the Use of High Discount

question 25

Multiple Choice

What is an argument against the use of high discount rates?

• A) Inflation can reduce the value of future earnings on a resource.
• B) Consumer preferences can make a product or resource obsolete.
• C) Resource owners can make more money by investing their capital in some other venture.
• D) High discount rates can encourage rapid exploitation of resources for immediate payoffs.
• E) They do not provide resource owners with reasonable with any monetary returns.

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Definitions:

Weaknesses

Refers to the areas or aspects where an individual or entity may lack strength or proficiency.

Grapevine

An informal and unofficial communication channel within an organization, through which information, rumors, and gossip are typically spread.

Trust

A strong conviction in someone or something's reliability, truthfulness, capability, or robustness.