A Limitation of ROI as a Measure of Performance Is

question 102

Multiple Choice

A limitation of ROI as a measure of performance is that

• A) it is a single comprehensive figure examining only one facet of the firm.
• B) it provides disincentive to use existing assets efficiently.
• C) it provides an incentive to acquire new assets.
• D) it is very sensitive to depreciation policy.
• E) it does not provide the basis for common comparison.

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Definitions:

Express Warranty

A clearly stated promise or guarantee about the quality or condition of a product or service made by a seller to a buyer.

Implied Warranty Of Merchantability

A legal presumption that ensures a product sold by a merchant meets certain quality and performance standards.

Disclaimer

A statement that denies responsibility or affiliation, often used to limit legal liability or to distance oneself from certain information or actions.

Unconscionable

A term applied to a contract in which one party has so much more bargaining power than the other party that the powerful party dictates the terms of the agreement and eliminates the other party’s free will.