Why Is It Usually Necessary to Use the Time Value

question 77

Multiple Choice

Why is it usually necessary to use the time value of money when performing a cost benefit analysis?

• A)For an investment project to be considered,costs must have a higher dollar value from benefits.
• B)In most investment projects costs are incurred up front,but benefits are provided in the future.
• C)For practical purposes,a dollar today may be considered to be equal to a dollar at some future time.
• D)Although costs and benefits generally occur concurrently,the benefits will accrue value over time,due to interest.

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Definitions:

Account Opportunity Level

A rating or assessment of the potential value or profitability that a particular customer or account could bring to a company.

Product

is any good, service, or idea that can be offered to a market to satisfy a want or need.

Swiss-Based Manufacturer

A company that engages in the production of goods and is headquartered in Switzerland.

Industrial Equipment

Machinery and tools designed for use in large-scale industrial production and operations.