The Optimal Amount of R&D for a Firm Depends on the Following

question 179

Multiple Choice

The optimal amount of R&D for a firm depends on the following, except

• A)marginal cost of funds for R&D projects.
• B)marginal benefit of R&D projects.
• C)expected profitability of R&D projects.
• D)amount of funds the firm currently has for R&D projects.

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Definitions:

Rate Of Return

The profit or deficit incurred from an investment over a chosen span of time, depicted as a fraction of the initial investment amount.

Present Value

The contemporary monetary evaluation of a future sum of money or series of cash flows, discounted by a particular rate of return.

Payment Plan

An agreement to pay back a sum of money owed over a period of time in a series of installments.

Account Earning

Interest or returns generated from an investment account or savings account over a period.