Nasser Inc

question 88

Multiple Choice

Nasser Inc.reported the following results from last year's operations:
Last year's return on investment (ROI) was closest to:

• A) 9.0%
• B) 47.6%
• C) 18.9%
• D) 80.7%

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Definitions:

Payback Period

The length of time it takes for an investment to generate enough cash flow to recover its initial cost.

Salvage Value

The expected remaining valuation of an asset after its service life has ended.

Straight-Line Method

A method of allocating the cost of a tangible asset over its useful life in equal annual installments.

Net Present Value

A method used to evaluate the profitability of an investment, calculating the difference between the present value of cash inflows and outflows over a period.