The Investment Decision Rule That Relates Average Net Income to Average

question 45

Multiple Choice

The investment decision rule that relates average net income to average investment is the:

• A) discounted cash flow rule.
• B) average accounting rate of return method.
• C) average payback rule.
• D) average profitability index.

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Definitions:

Break-Even Point

The level of sales at which total revenues equal total expenses, resulting in no profit or loss for the business.