The Blue Moon Is Considering a Project Which Will Produce

question 247

Multiple Choice

The Blue Moon is considering a project which will produce sales of $120,000 a year for the next five years. The profit margin is estimated at 5.5 percent. The project will cost $140,000 and will be
Depreciated straight-line to a book value of zero over the life of the project. The firm has a required
Accounting return of 9.5 percent. This project should be _____ because the AAR is _____ percent.

• A) Rejected; 4.71
• B) Rejected; 8.57
• C) Rejected; 9.43
• D) Accepted; 9.67
• E) Accepted; 9.43

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Definitions:

Language Differences

Variations in language, including vocabulary, grammar, and syntax, that can affect communication and understanding between individuals from different linguistic backgrounds.

Foreign Subsidiaries

Companies that are owned or controlled by another corporation based in a different country.

Multinational Firms

Companies that operate in multiple countries, managing production or delivering services in more than one country globally.

Gender Differences

The distinctions in characteristics, behaviors, physical and psychological traits, roles, and status attributed to males and females by society and culture.