Unless There Are Other Factors to Be Considered,an Investment Opportunity

question 117

True/False

Unless there are other factors to be considered,an investment opportunity with a return on investment that equals or exceeds the company's required rate of return would be accepted.

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Definitions:

Call Option

An agreement in finance that grants the purchaser the option, without the mandate, to acquire a security, bond, commodity, or different asset at a pre-determined price during a defined timeframe.

Variance

The average squared deviation between the actual return and the average return.

American Call Option

A financial contract that gives the buyer the right, but not the obligation, to buy an underlying asset at a specified price on or before a specified date.