Which of the Following Decision Rules Is Best Defined as the Amount

question 55

Multiple Choice

Which of the following decision rules is best defined as the amount of time it takes to pay back the initial investment?

• A) internal rate of return (IRR)
• B) profitability index
• C) net present value (NPV)
• D) payback period

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Definitions:

Production Possibility Frontier

A chart that outlines the utmost production possibilities for two types of goods, contingent upon a selection of resources and other conditions.

Technology Improvement

Enhancements or innovations in technology that increase productivity, efficiency, and product quality in various sectors.

Economy

The system of production, consumption, and distribution of goods and services in a particular geographic region or country.

Production Possibility Frontier

A chart representing the ultimate production possibilities of two items, given certain inputs and the current state of technology.