Which of the Following Is a Reason That Makes NPV

question 83

Multiple Choice

Which of the following is a reason that makes NPV a better approach to capital budgeting on a purely theoretical basis?

• A)It measures the benefits relative to the amount invested.
• B)It measures the actual value created by an investment.
• C)Financial decision makers are inclined to higher rates of return.
• D)Interest rates are expressed as annual rates of return.

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Definitions:

Commutator

A device used in electric motors and generators to periodically reverse current direction between the rotor and the external circuit.

Alternators

Machines that convert mechanical energy to electrical energy by producing alternating current, commonly used in cars to charge the battery and power the electrical system when the engine is running.

Revolving-field-type

The revolving-field-type refers to a design in electrical machines, particularly alternators, where the magnetic field rotates around a stationary armature, inducing an alternating current.

Non-rotating Part

Components in machinery or devices that do not move around an axis, contrasting with rotating parts, typically providing structural support or enclosing moving parts.