When a Company Is Evaluating an Investment with Discounted Cash

question 63

True/False

When a company is evaluating an investment with discounted cash flows, if the investment has a higher risk, the company will use a lower discount rate, and vice versa.

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Definitions:

Employment Discrimination

Unfair treatment of employees or job applicants based on race, gender, age, religion, nationality, physical disabilities, or sexual orientation, rather than on their qualifications or performance.

Productivity Factors

Elements that contribute to the efficiency with which inputs are converted into outputs, such as technology, innovation, and labor skills.

Mean Earnings

The average income that a group of individuals or entities earns over a specified period.

Earnings Ratio

A financial metric comparing one aspect of a company's financial performance, such as earnings, to another, such as its share price.