Use the Information Below to Answer the Following Question(s)

question 88

Multiple Choice

Use the information below to answer the following question(s) .Ruth Cleaning Products manufactures home cleaning products.The company has two divisions, Bleach and Bleach-2.Because of different accounting methods and inflation rates, the company is considering multiple evaluation measures.The following information is provided for the year just ended:
The company is currently using a required rate of return of 15 percent.
-What are Bleach's and Bleach-2's residual incomes, based on current values, respectively?

• A)$116,250; $37,500
• B)$110,000; $67,500
• C)$67,500; $110,000
• D)$37,500; $116,250
• E)$115,340; $80,000

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Definitions:

Willing To Pay

The maximum amount an individual or entity is ready to spend to acquire a good or service or to avoid something undesirable.

Market Failure

A situation where the allocation of goods and services by a free market is not efficient, often leading to a net social welfare loss.

Economically Desirable

Characteristics or actions that are considered beneficial for the economy, potentially enhancing efficiency or growth.

Private Markets

Markets where transactions are conducted directly between parties without public oversight or regulation, often relating to investments or services.