Use the Information for the Question(s) Below

question 2

Multiple Choice

Use the information for the question(s) below.
Boulderado has come up with a new composite snowboard. Development will take Boulderado four years and cost $250,000 per year, with the first of the four equal investments payable today upon acceptance of the project. Once in production the snowboard is expected to produce annual cash flows of $200,000 each year for 10 years. Boulderado's discount rate is 10%.
-Take any investment opportunity where the IRR ________ the opportunity cost of capital.Turn down any opportunity whose IRR is ________ than the opportunity cost of capital.

• A) exceeds; less
• B) exceeds; higher
• C) less than; less
• D) less than; higher

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Definitions:

Cultures

the shared values, traditions, norms, customs, arts, history, and institutions of a group of people.

Routine Decisions

Decisions that are made regularly and are often automated or based on established guidelines or procedures.

Organizational Politics

The use of power and social networking within an organization to achieve changes that benefit the individual or group, often at the expense of others.

Inoculation Effect

The inoculation effect is a social psychological and communication theory that explains how an initial exposure to a weakened form of an argument makes individuals more resistant to later attempts to change their attitudes or beliefs.