The Appropriate Cost of Capital to Use in Valuing an IT

question 25

True/False

The appropriate cost of capital to use in valuing an IT project is the same regardless of the project riskiness.

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Definitions:

Productivity

measures the efficiency of production in terms of the amount of output generated per unit of input, such as labor or capital.

Human Capital

The collective skills, knowledge, or other intangible assets of individuals that can be used to create economic value for the individuals, their employers, or their community.

Capital Stock Per Worker

A measure of the amount of capital available per employee in a company or economy, indicating the level of investment in tools, buildings, and equipment each worker has to work with.

Output Per Worker

The average production or output produced per unit of labor, often used as a measure of labor productivity.