Using the Benefit-Cost Ratio the Decision Rule Is to Accept

question 25

Multiple Choice

Using the benefit-cost ratio the decision rule is to accept projects with a benefit-cost ratio:

• A)equal to 1.
• B)less than 1.
• C)greater than the opportunity cost.
• D)greater than 1.

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Definitions:

Market Price

The ongoing price for buying or selling a service or asset.

Profit-Maximizing

A strategy or decision-making process aimed at achieving the highest possible profit from business operations.

Market Price

The existing rate at which merchandise or services are exchanged in a commercial environment.

Losses

Situations where expenses exceed revenues, resulting in negative income.