(Ignore Income Taxes in This Problem

question 67

Multiple Choice

(Ignore income taxes in this problem.) Anthony operates a part time auto repair service.He estimates that a new diagnostic computer system will result in increased cash inflows of $1,500 in Year 1,$2,100 in Year 2,and $3,200 in Year 3.If Anthony's required rate of return is 10%,then the most he would be willing to pay for the new diagnostic computer system would be:

• A) $4,599
• B) $5,501
• C) $5,638
• D) $5,107

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Definitions:

Recognition

Recognition is the identification of a previously encountered or known entity, such as a person, place, or object, distinguishing it from unfamiliar ones.

Recall

involves the ability to remember previously learned information or experiences.

Marketing Stimuli

Elements or actions, such as advertising and promotions, used by marketers to encourage or influence consumer responses or behaviors.

Reliable Measure

A consistent and dependable method of assessment that produces accurate and repeatable results.