You Are a Manager Considering a Positive-NPV Project

question 70

Multiple Choice

You are a manager considering a positive-NPV project. Which of the following announcements indicate that you may have underestimated its NPV?

• A)Two critical industry suppliers announce that they will merge their firms.
• B)A key competitor releases earnings results, and its stock price drops by 25 percent in response.
• C)You just found out that the project's chief engineer has recently received multiple job offers from competing firms.
• D)Your marketing staff alerts you that the new project may "cannibalize" sales (i.e., reduce sales)of existing product to a greater extent.

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Definitions:

Float

In a nursing or hospital context, to move or be assigned to different wards or units as needed, rather than having a fixed place.

Oncology Unit

A specialized department within a hospital or medical facility that provides treatment and care for cancer patients.

Orthopedic Unit

A specialized department within a hospital focused on the treatment of patients with skeletal system and associated muscles, joints, and ligaments conditions.

Managed Care

Health care system in which there is administrative control over primary health care services. Redundant facilities and services are eliminated, and costs are reduced. Preventive care and health education are emphasized.