A Financial Manager Is Evaluating a Project Which Is Expected

question 126

Multiple Choice

A financial manager is evaluating a project which is expected to generate profits of $100,000 per year for the next 10 years.The project should be accepted if

• A) the cost of the project is less than $1,000,000.
• B) the cost of the project is less than the present value of $100,000 per year for 10 years.
• C) this project's expected profits are higher than any other projects the corporation has available.
• D) the present value of the project's cash inflows exceeds the present value of the project's cash outflows.

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Definitions:

Prejudice

Preconceived opinion or bias against an individual or group without sufficient knowledge, thought, or reason.

Stereotyping

The act of assigning identical characteristics to any person in a group regardless of the actual diversity among members of that group.

Ingroup Members

Individuals who belong to and identify with a particular group or category, often leading to preferential treatment of these individuals over those not in the group (outgroup members).

September 11

Refers to the terrorist attacks that occurred on September 11, 2001, in the United States, significantly impacting global politics and policies.