When the Investment Cannot Be Delayed,the Optimal Rule Is to Invest

question 12

Multiple Choice

When the investment cannot be delayed,the optimal rule is to invest whenever ________ is greater than zero.

• A) the profitability index
• B) the payback period
• C) the internal rate of return
• D) the discounted payback period

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Definitions:

Demand Increase

A rise in the quantity of a product or service that consumers are willing and able to purchase at a given price over a certain period of time.

Usury Laws

Regulations that impose a maximum interest rate that can be charged on loans to prevent excessive and unfair interest rates.

Interest

The cost of borrowing money, typically expressed as a percentage of the amount borrowed, or the income earned on deposited funds.

Rent

A periodic payment made by a tenant to a landlord for the use of land, premises, or other property.