The Main Drawback to Utilitarian Reasoning Is That

question 48

Multiple Choice

The main drawback to utilitarian reasoning is that:

• A) The majority may override the rights of those in the minority.
• B) Managers using this reasoning process often fail to consider the means taken to reach the end.
• C) It is difficulty to accurately measure both costs and benefits.
• D) Cost-benefit calculations can only be provided by accountants.

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Definitions:

Market Portfolio

A theoretical portfolio comprising all assets in the market, with each asset weighted by its market capitalization, representing the entire stock market's performance.

Risk-free Rate

The rate of return on an investment with zero risk, typically based on government bonds.

Dividend Increase

A company's decision to raise the amount of dividends paid to its shareholders, often viewed as a positive signal of the company's profitability and future prospects.

Required Return

Required return is the minimum annual percentage earned by an investment that will induce individuals or companies to put money into a particular security or project.