Emma Is Considering a New Cat Nip Factory with the Following

question 63

Multiple Choice

Emma is considering a new cat nip factory with the following cash flows,if the disoucnt rate is 7%,what is the PI?

• A) 1.067
• B) 1.050
• C) 0.943
• D) 1.008

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Definitions:

Normal Profits

The return to the business owners for the opportunity cost of their implicit inputs.

MRP

Marginal Revenue Product, a term in economics that represents the additional revenue generated by employing one more unit of a factor, such as labor or capital.

Investment

The allocation of resources, such as capital or time, in order to generate future profit or income.

Usury Laws

Statutes that set maximum interest rates that can be charged on loans, intended to protect consumers from excessively high rates.