The Ratio of Net Present Value to Initial Investment Is

question 95

Multiple Choice

The ratio of net present value to initial investment is known as the:

• A) net present value.
• B) internal rate of return.
• C) payback period.
• D) profitability index.

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Definitions:

Total Utility

The complete fulfillment derived from the consumption of a specific amount of products or services.

Utility-Maximizing

The economic principle where individuals or entities choose to allocate their resources in a way that maximizes their satisfaction or utility.

Marginal Utility-To-Price Ratio

A measure of the additional satisfaction gained from consuming one more unit of a good or service relative to its cost.

Consumer Choice

The decision-making process by which individuals select and consume products or services to satisfy their desires and needs.