The Owners of a Chain of Fast-Food Restaurants Spend $28

question 26

Multiple Choice

The owners of a chain of fast-food restaurants spend $28 million installing doughnut makers in all their restaurants. This is expected to increase cash flows by $10 million per year for the next five years. If the discount rate is 6.5%, were the owners correct in making the decision to install doughnut makers?

• A)Yes, as it has a net present value (NPV)of $8.74 million.
• B)No, as it has a net present value (NPV)of -1.68 million.
• C)Yes, as it has a net present value (NPV)of $13.56 million.
• D)No, as it has a net present value (NPV)of -$2.25 million.

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Definitions:

Physical Demands

The physical requirements necessary to perform a job or task, including lifting, standing, or manual dexterity.

Role Demands

Expectations placed upon individuals based on their specific role within an organization or social context.

Organizational Stressors

Factors or conditions within an organization that can cause stress to employees, leading to reduced productivity and satisfaction.

Role Demands

The expectations, responsibilities, and pressures associated with a particular role or job position within an organization.