Which One of the Following Is Specifically Designed to Compute

question 82

Multiple Choice

Which one of the following is specifically designed to compute the rate of return on a project that has unconventional cash flows?

• A)Average accounting return
• B)Profitability index
• C)Internal rate of return
• D)Indexed rate of return
• E)Modified internal rate of return

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Definitions:

Notes

Short-term financial instruments, typically in the form of a debt or loan, that require repayment of the principal and interest by the issuer.

Drafts

Preliminary versions of documents, or negotiable instruments drawn by one party (drawer) ordering another party (drawee) to pay a specified sum to a third party.

Indorsed in Blank

A signature on a negotiable instrument like a check, making it payable to whoever holds the instrument, without naming a specific endorsee.

Holder in Due Course

A party that has acquired a negotiable instrument in good faith and for value, granting them certain protections and rights under the law.