Offering Diversions to Occupy Customers While They Wait Is Referred

question 10

Multiple Choice

Offering diversions to occupy customers while they wait is referred to as?

• A) Complementary services
• B) Reservations
• C) Demand sorting
• D) Pricing policies/promotions

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Definitions:

NPV (Net Present Value)

A method used in capital budgeting to evaluate the profitability of an investment or project, calculated by subtracting the total present values of cash outflows from the total present values of cash inflows.

IRR (Internal Rate of Return)

A financial metric used to estimate the profitability of potential investments, calculated as the discount rate that makes the net present value (NPV) of all cash flows from a particular project equal to zero.

Discount Rate

The interest rate charged to commercial banks and other financial institutions for loans received from the central bank's discount window.

High-risk Projects

High-risk projects are those that come with a greater uncertainty regarding outcomes, potentially offering higher returns alongside increased potential for loss.