An Investment Has an Initial Cost of $3

question 66

Multiple Choice

An investment has an initial cost of $3.3 million.This investment will be depreciated by $900,000 a year over the three-year life of the project.Should this project be accepted based on the average accounting rate of return if the required rate is 10.0 percent? Why or why not?

• A)Yes, because the AAR is 10.0 percent
• B)Yes, because the AAR is less than 10.0 percent
• C)Yes, because the AAR is greater than 10.0 percent
• D)No, because the AAR is greater than 10.0 percent
• E)No, because the AAR is less than 10.0 percent

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Definitions:

Goal Setting

The process of identifying specific, measurable, and time-targeted objectives to be achieved.

Specific, High

This term lacks context but in goal-setting theory, "specific, high" goals refer to well-defined and challenging objectives that enhance motivation and performance.

Team Goal Setting

The process of defining and agreeing on objectives within a team to focus efforts and foster unity in pursuit of common aims.

Individual Goal Setting

The process of establishing specific, measurable, achievable, relevant, and time-bound (SMART) objectives for oneself to achieve personal or professional success.