What Would Happen If the World's Resources Were to Suddenly

question 61

Multiple Choice

What would happen if the world's resources were to suddenly double?

• A) The scarcity principle would still apply.
• B) The scarcity principle would not be relevant.
• C) Everyone's wants would be met.
• D) No tradeoffs would be needed.

Calculate the internal rate of return (IRR) and simple rate of return (SRR) for investment projects.

Rank investment projects based on profitability index.

Estimate annual cost savings and revenue requirements for investment justification.

Understand the effect of project's salvage value on investment decisions.

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Definitions:

Unit Contribution Margin

The difference between the selling price per unit and the variable cost per unit. It measures how much each unit sold contributes to fixed costs and profit.

Break-Even Point

The level of business operations at which revenues and expired costs are equal.

Cost-Volume-Profit Chart

A chart that graphically shows sales, costs, and the related profit or loss for various levels of units sold.

Total Costs

The sum of all costs associated with the production or acquisition of goods and services, including variable and fixed costs.