The Profitability Index Method of Project Evaluation Provides an Answer

question 26

Multiple Choice

The profitability index method of project evaluation provides an answer that is a:

• A)rate of interest.
• B)dollar value.
• C)time period.
• D)ratio.

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Definitions:

Business Use

The utilization of goods, services, or assets for the purpose of generating income or benefits in a business context.

Half-Year Convention

The Half-Year Convention is a method for calculating depreciation in which all assets acquired during a year are considered to have been acquired at the midpoint of the year.

Real Property

Land and anything permanently affixed to it, such as buildings, fences, and those things attached to the buildings.

MACRS

The Modified Accelerated Cost Recovery System, a method of depreciation in the U.S. for tax purposes, allowing businesses to recover investments in certain property over time.