If the Required Return Is 12%, What Is the Discounted

question 144

Multiple Choice

If the required return is 12%, what is the discounted payback period of the following cash flows?

• A) 2 years
• B) 3 years
• C) 4 years
• D) 5 years
• E) The project does not pay back on a discounted basis.

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Definitions:

Potentially Efficient

A state in which resources could be utilized in a way that maximizes the net benefits to society or an economy, although not necessarily currently achieved.

Low-Income Families

These are households that earn significantly less than the average income for their society, often making it difficult to afford basic living expenses.

High-Income Families

Households that earn significantly above the average income for their geographical location or society as a whole.

Public Recreation Center

A facility provided and maintained by a community or government to offer recreational, educational, and social activities to the public.