The Capital Budgeting Technique That Finds the Interest Yield of the Potential

question 89

Multiple Choice

The capital budgeting technique that finds the interest yield of the potential investment is the

• A) annual rate of return method.
• B) internal rate of return method.
• C) net present value method.
• D) profitability index method.

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Definitions:

Marginal Product

The additional output that is produced by employing one more unit of a particular resource.

Average Product

The output produced per unit of input, calculated by dividing total production by the total number of inputs.

Marginal Product

The additional output that results from the use of one more unit of a production input, holding all other inputs constant.

Nonlabor Resources

Inputs used in the production of goods and services that do not involve human labor, such as capital, land, and natural resources.