A Company Is Evaluating a Variety of Different Capital Investment

question 95

Multiple Choice

A company is evaluating a variety of different capital investment opportunities.The company can only choose one project due to limited funds.What would be the best capital budgeting method for this company to use to select a project?

• A)Payback method
• B)Accounting rate of return method
• C)Net present value method
• D)Profitability index

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Definitions:

Chief Executive Officer

The highest-ranking executive in a company, responsible for making major corporate decisions and managing overall operations.

Competitive Responses

Actions taken by companies to address competition, adapt to market changes, and sustain or improve their market position.

Failure Rate

The proportion of businesses or projects that do not achieve their goals and are deemed unsuccessful.

High-Growth Stage

A phase in a company’s development characterized by a rapid expansion in sales, revenue, and company size.