Consider a Project That Would Change the Way Your Company

question 34

Multiple Choice

Consider a project that would change the way your company is doing business.Investing $100,000 would save your company $10,000 a year forever.Calculate the NPV of this project if the risk-adjusted rate is 10%.

• A)$10,000
• B)$100,000
• C)$0
• D)$ −90,000

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Definitions:

Hourly Wage

The amount of money paid for each hour of work.

Dual Labor Market Theory

A theory suggesting the labor market is divided into two segments—the primary (high wage, good jobs) and the secondary (low wage, poor quality jobs) sectors.

Productivity Growth

The increase in the efficiency of production, measured by the amount of goods and services produced per unit of input.

Unionized Workers

Employees who are members of a union, which is an organized association formed to protect and further their rights and interests.