Potential Reasons That Technologically Based Product Innovations Result in a Negative

question 13

Multiple Choice

Potential reasons that technologically based product innovations result in a negative net present value are:

• A)competitors' ability to mimic these products after long periods of time
• B)uncertainties over revenues and costs of these projects
• C)uncertainties over revenues and costs of these projects and competitors' ability to mimic these products after long periods of time
• D)certainty of cash flows and competitors' ability to mimic these products quickly

---

Definitions:

Double Diminishing-Balance

The double declining balance method is an accelerated depreciation technique that doubles the normal depreciation rate, reducing the value of an asset more quickly in its early years.

Constant Percentage

A fixed percentage rate applied in various financial calculations, such as depreciation or interest computation.

Double Diminishing-Balance

A method of accelerated depreciation that doubles the standard depreciation rate.

Depreciation Expense

The allocation of the cost of a tangible asset over its useful life, reflecting the decrease in value due to wear and tear, age, or obsolescence.