Which of the Following Statements Is True

question 72

Multiple Choice

Which of the following statements is true?

• A) Using the same WACC to discount all a firm's potential investments is a sound financial practice.
• B) When a firm has debt in its capital structure, the cost of equity is the appropriate discount rate to use in NPV calculations.
• C) If an investment being evaluated has higher risk than the firm's current set of projects, the firm's WACC is the appropriate discount rate to use.
• D) Statements (a) and (b) are true
• E) All of the above statements are false.

Recognize and avoid the use of camouflaged verbs to enhance clarity in writing.

Identify and eliminate slang and business clichés to achieve professionalism in writing.

Identify discriminatory language in sentences.

Correct sentences to improve clarity, precision, and avoid discrimination.

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Definitions:

Quality-Oriented Incentives

Rewards or bonuses given to employees for meeting or exceeding quality standards in their work.

Team Awards

Recognitions or rewards given to a group of employees for their collective performance, achievements, or contributions toward organizational goals.

Group Incentive

A reward system where a team of employees is financially compensated based on the achievement of certain predefined targets or goals.

Employee Stock Ownership Plan

A program that grants employees ownership interest in the company, typically through the allocation of stock.