Which of the Following Statements Is Correct

question 71

Multiple Choice

Which of the following statements is correct?

• A)Capital budgeting analysis is not a framework for evaluating all business decisions; it is only a tool for the "financial" types.
• B)Proper analysis will identify irrelevant cash flows and an appropriate discount rate to reflect the risk of the strategy and will compare the benefits and costs of the project without 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 not 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:

Severity Errors

Biases in evaluation, especially in performance appraisals, where the evaluator tends to rate everyone lower (or harsher) than deserved.

Leniency Errors

A type of bias in performance appraisals where the evaluator tends to rate employees more favorably than their performance deserves.

Recency Errors

A cognitive bias that leads individuals to give greater importance to the most recent information or experiences.

Worker Involvement

The meaningful participation and empowerment of employees in the decision-making processes within their workplace.