A Primary Limitation of Return on Investment (ROI) as a Performance

question 142

Multiple Choice

A primary limitation of return on investment (ROI) as a performance evaluation metric for investment centers is that ROI:

• A) Is a long-term, not short-term, performance indicator.
• B) Understates the level of investment for organizations operating in the so-called knowledge-based economy.
• C) Excludes the level of investment from the performance metric.
• D) Cannot handle current-value estimates of assets.
• E) Is not a relative performance indicator.

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Definitions:

Axon

A long, slender projection of a nerve cell, or neuron, which typically conducts electrical impulses away from the neuron's cell body.

Receptor Sites

Specific locations on the surface of a cell or within a cell where molecules, such as hormones or neurotransmitters, can bind to elicit a cellular response.

Neurotransmitter

Chemical substances that transmit signals across a chemical synapse, from one neuron to another neuron, muscle cell, or gland cell.

Analogy

A comparison between two things, typically for the purpose of explanation or clarification, showing similarities in some respects.