Financial Information That Is Capable of Making a Difference in a Decision

question 10

Multiple Choice

Financial information that is capable of making a difference in a decision is

• A) faithfully representative.
• B) relevant.
• C) convergent.
• D) generally accepted.

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Definitions:

Projected Cash Flows

Estimates of the amount of money expected to flow in and out of a business over a future period.

Time Value of Money

The principle that a dollar received today is worth more than a dollar received in the future, due to its potential earning capacity.

Hurdle Rate

The minimum acceptable rate of return on an investment that a manager or investor expects to achieve.