When There Is an Option to Delay,a Good Rule of Thumb

question 42

Multiple Choice

When there is an option to delay,a good rule of thumb is to invest only when ________.

• A) the internal rate of return is at least 1
• B) the net present value is at least 1
• C) the payback period is at least 1
• D) the profitability index is at least 1

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Definitions:

Monetary Policy

Actions by a central bank or other regulatory authority to influence a nation's money supply and interest rates to achieve macroeconomic objectives such as controlling inflation, consumption, growth, and liquidity.

Fiscal Policy

Government policies related to taxation and public spending with the aim of influencing economic conditions, including growth, inflation, and unemployment rates.

Legislation

Laws and statutes that are enacted by a legislative body through its legislative process.

Marginal Propensity

The portion of additional income that an individual spends on consuming goods and services, as opposed to saving.