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The manager of the recently formed Oak Division of Parkes, Incorporated, is evaluating the following four investment opportunities available to the division. Parkes, Incorporated, requires a minimum return of 10 per cent.
a.Calculate the return on investment (ROI) for each investment opportunity.
b.If only one investment opportunity can be funded and the division is evaluated based on ROI, which investment opportunity would be accepted?
c.If Parkes, Incorporated, can fund all of the projects and wishes to achieve the best possible performance, which investments would be accepted?
Third Unit
In economic terms, it refers to purchasing or producing a third unit of a good or service, often discussed in the context of marginal analysis.
Socially Optimal
A state or outcome of an economic or social process that maximizes societal welfare, taking into account all costs and benefits to society.
Fair-Return
A principle whereby regulated entities are allowed to set prices that cover their costs and provide a reasonable profit.
Price-Discriminating
A pricing strategy where a seller charges different prices for the same product or service to different customers based on various factors.
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