Beige Inc Has to Choose from Three Projects Whose Internal Rates

question 6

Multiple Choice

Beige Inc. has to choose from three projects whose internal rates of return (IRRs) are more than the marginal cost of capital (MCC) . Beige should choose those projects that _____.

• A) minimize the marginal cost of capital
• B) maximize the excess of internal rate of return over marginal costs
• C) maximize the dividend payout
• D) maximize the cash flow from investment in projects
• E) minimize the rate of return to the investors

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Definitions:

Pay to Performance

A compensation strategy where employees' pay is directly linked to their performance, often used to motivate and reward high achievers.

Annual Budgeting

The process of forecasting an organization's income and expenditures for a fiscal year.

Production Goals

Targets set by a business for the quantity and quality of products to be produced within a certain timeline.

Accounting Mechanism

The systematic process of recording, analyzing, summarizing, and reporting financial transactions of a business.