Refer to the Figure Below

question 23

Multiple Choice

Refer to the figure below. A charge for electricity that is based on a flat rate plus a variable cost after a certain number of kilowatt-hours are used follows which of the following cost behavior patterns?

• A) Graph A
• B) Graph B
• C) Graph C
• D) Graph D

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Definitions:

Net Present Value

A financial metric used to evaluate the profitability of an investment, calculated by subtracting the present value of cash outflows from the present value of cash inflows over a period.

Annual Revenue

The total amount of money earned from the sale of goods or services in a fiscal year before any expenses are subtracted.

Annual Expenses

The total amount of money spent or costs incurred by a business or individual in a one-year period.

Capital Budgeting

The process by which an organization evaluates and selects long-term investments that are in line with their goal of wealth maximization.