One Approach to Measuring the Short-Term Financial Performance of a Business

question 51

Multiple Choice

One approach to measuring the short-term financial performance of a business unit considered an investment center is return on investment (ROI) . ROI is expressed as operating income of the investment center:

• A) Divided by the current year's capital expenditures plus cost of capital.
• B) Minus imputed interest charged for the use of invested capital by the investment center.
• C) Divided by fixed assets.
• D) Divided by the assets used by the investment center.
• E) Minus the asset turnover (AT) of the investment center.

---

Definitions:

Goal-Directed Behaviors

Actions taken by an individual or organism with the intention of achieving a specific outcome or fulfilling a particular purpose.

Bindra

A theorist known for contributing to the understanding of motivation and emotion through the concept of drive reduction.

Positive Incentives

Rewards or benefits that motivate individuals to perform certain actions or behaviors.

Negative Incentives

Penalties or undesirable outcomes that are used to discourage certain behaviors or decisions.