All of the Following Statements Are Correct EXCEPT

question 43

Multiple Choice

All of the following statements are correct EXCEPT:

• A)Capital budgeting analysis is a framework for evaluating all business decisions; it is not only a tool for the "financial" types.
• B)Proper analysis will identify relevant cash flows and an appropriate discount rate to reflect the risk of the strategy and will compare the benefits and costs of the project by considering the time value of money.
• C)Whether the investment is one in a business strategy, building a new warehouse, seeking fuel efficient methods of doing business, upgrading information technology systems, or investing in human resources, we should try to quantify the benefits and cost of these choices in order to evaluate them properly.
• D)To achieve success over time, a firm's managers must identify and invest in projects that provide positive net present values to maximize shareholder wealth.
• E)all of the above statements are correct

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Definitions:

Price Inelastic

A characteristic of a good or service for which demand does not significantly change with a change in its price.

Price Support

The term used to refer to price floors applied to farm commodities; the minimum price that the government allows farmers to receive for farm commodities like wheat or corn.

Farm Incomes

Farm incomes encompass the earnings and revenue generated from agricultural activities, reflecting the financial health and viability of farming operations.

Price Elasticity

A measure of how much the quantity demanded of a good responds to a change in its price.