Suppose Your Firm Is Considering Investing in a Project with the Cash

question 21

Multiple Choice

Suppose your firm is considering investing in a project with the cash flows shown as follows, that the required rate of return on projects of this risk class is 10 percent, and that the maximum allowable payback and discounted payback statistics for the project are three and a half and four and a half years, respectively. Use the discounted payback decision to evaluate this project; should it be accepted or rejected? $$\begin{array} { l c c c c c c c } \text { Time } & 0 & 1 & 2 & 3 & 4 & 5 & 6 \\\hline \text { Cash Flow } & - \$ 5,000 & \$ 1,200 & \$ 1,400 & \$ 1,600 & \$ 1,600 & \$ 1,100 & \$ 2,000 \\\hline\end{array}$$

• A)Discounted payback = 4.25 years; accept the project
• B)Discounted payback = 3.50 years; accept the project
• C)Discounted payback > 5 years; reject the project
• D)Discounted payback = 4.67 years; reject the project

Analyze organizational schemes to determine the correct placement of concepts.

Compare and contrast the level of abstraction among different concepts within a specific classification system.

Understand the concepts of peer influence and adolescent vulnerability.

Comprehend the categorization of adolescent behaviors and issues in terms of moral, prudential, conventional, and personal domains.

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Definitions:

Profit Motive

The incentive that drives individuals or entities to engage in activities that are expected to generate financial gain.

Employment Discrimination

The unfair treatment of employees based on race, gender, religion, age, disability, or sexual orientation rather than job performance.

Profit Motive

The intention or incentive to achieve financial gain in business or commerce, often seen as the primary driving force behind economic activities.

Productive Female

An individual female who contributes significantly to productivity, often in the context of work or reproduction.