A Financial Manager Who Does Not Follow the General Constraints

question 9

Multiple Choice

A financial manager who does not follow the general constraints of the NPV rule may:

• A)accept a negative project for fear of losing an investment opportunity.
• B)accept a marginally acceptable NPV project limiting the corporation's ability to choose a competing project.
• C)option the project to another firm.
• D)not take a positive NPV project even if the NPV is adequate reward to forego the option.
• E)None of the above.

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Definitions:

Social Learning Theory

A theory that suggests individuals learn new behaviors by observing and imitating others, as well as through the rewards and punishments these behaviors produce.

Positive Peer Culture

A social environment or setting in which peers support one another in making positive choices and personal growth.

Antisocial Peer Group Norms

Behavioral standards within a peer group that encourage violation of social norms or laws, often negatively influencing group members.

Social Exchange Theory

A conceptual framework suggesting that social behavior is the result of an exchange process aiming to maximize benefits and minimize costs in relationships.