The Following Information Is Available for a Potential Investment for Panda

question 83

Multiple Choice

The following information is available for a potential investment for Panda Company: $\begin{array}{lr}\text { Initial investment } & \$ 40,000 \\\text { Net annual cash inflow } & 10,000 \\\text { Net present value } & 18,112 \\\text { Salvage value } & 5,000 \\\text { Useful life } & 10 \text { yrs. }\end{array}$ The potential investment's profitability index is

• A)4.00.
• B)2.85.
• C)2.50.
• D)1.45.

Identify the point of diminishing returns.

Interpret production tables and figures to determine optimal production techniques.

Analyze the cost-minimization strategy of a firm based on the marginal product and price of inputs.

Understand how changes in input prices affect a firm's production choices.