Which of the Following Is Used as the Equation's Denominator

question 61

Multiple Choice

Which of the following is used as the equation's denominator when computing the accounting rate of return for a capital asset?

• A)Initial investment amount
• B)Average annual operating income from the asset
• C)Total amount invested in the asset
• D)Average net cash flows from the asset

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Definitions:

Technological Advance

The improvement or development of new methods, devices, or materials that increase efficiency and productivity.

Personal Computers

Electronic devices designed for individual use, capable of executing a wide range of applications, including word processing, internet browsing, and gaming.

General Equilibrium

A condition in an economy where all markets are in equilibrium simultaneously, and there are no external forces causing shifts in supply and demand.

Equilibria

The condition in which all competing influences are balanced in a wide variety of contexts, including economics where supply equals demand.