Which of the Following Decision-Making Tools Would NOT Be Useful

question 59

Multiple Choice

Which of the following decision-making tools would NOT be useful in determining the slope and intercept of a mixed cost?

• A)linear programming
• B)least-squares method
• C)high-low method
• D)scatter diagrams

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Definitions:

Cost of Capital

Represents the rate of return that a company must earn on its investment projects to maintain its market value and attract funds.

Capital Rationing

The process of selecting profitable projects under the constraint of limited available investment funds.

Internal Rate of Return

A financial metric used to evaluate the profitability of an investment, calculated as the discount rate that makes the net present value of all cash flows from the investment equal to zero.

Hurdle Rate

Hurdle Rate is the minimum acceptable return on investment or project that a business requires before it considers it viable or proceeds with it.