Which One of the Following Capital Budgeting Models Considers Both

question 80

Multiple Choice

Which one of the following capital budgeting models considers both profitability and the time value of money?

• A)Payback
• B)Accounting rate of return
• C)Net present value
• D)Both a and c are correct

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Definitions:

Business Registration

The process of officially recording a new business with the relevant governmental authority.

Express or Implied Agreement

A mutual understanding between parties to a contract where terms are specifically stated (express) or suggested by actions or circumstances (implied).

Partnership Capital

Funds contributed by partners to a partnership for the purpose of financing its operations, shared according to the partnership agreement.

Majority of Partners

The term "majority of partners" refers to more than half of the individuals in a partnership who hold the power to make decisions binding the partnership.