Most Embryonic Industries Arise From

question 65

Multiple Choice

Most embryonic industries arise from:

• A) a technological breakthrough.
• B) product proliferation.
• C) lack of high entry barriers.
• D) chaining.
• E) franchising.

Grasp the concept of controllable versus uncontrollable costs and their relevance in managerial performance evaluation.

Understand the principles of cost allocation to departments and products.

Calculate departmental income considering allocated costs.

Explain the concept and application of activity-based costing (ABC).

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Definitions:

Present Value

Present value is the current worth of a future sum of money or stream of cash flows given a specified rate of return.

Internal Rate of Return

A financial metric used to estimate the profitability of potential investments by calculating the rate of return at which the net present value of costs (cash outflows) equals the net present value of benefits (cash inflows).

Average Rate of Return

A financial ratio used to measure the profitability of an investment, calculated as the average annual profit divided by the initial investment cost.

Cash Payback Period

The time period required for the cash inflows from a capital investment project to cover the initial cash outlay.