Assume in Analyzing Alternative Proposals That Proposal F Has a Useful

question 110

Multiple Choice

Assume in analyzing alternative proposals that Proposal F has a useful life of 6 years and Proposal J has a useful life of 9 years. What is one widely used method to make the net present values of the proposals comparable?

• A)Ignore the fact that Proposal F has a useful life of 6 years and treat it as if it has a useful life of 9 years.
• B)Adjust the life of Proposal J to a time period that is equal to that of Proposal F by estimating a residual value at the end of year 6.
• C)Ignore the useful lives of 6 and 9 years and find an average (7 1/2 years).
• D)Ignore the useful lives of 6 and 9 years and compute the average rate of return.

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Definitions:

Physical Harm

Physical Harm entails injury or damage to the body of a person caused by external forces or substances.

Vicarious Liability

A legal concept where one party is held responsible for the actions or negligence of another party, often seen in employer-employee relationships.

Tortious Conduct

Behavior that causes injury or harm to another, making the actor liable to civil legal action.

Reasonable Care

A legal standard that requires individuals to act with the caution and prudence that a reasonable person would use in similar circumstances, to prevent harm to others.