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

question 106

Multiple Choice

Use the information below to answer the following question(s) .Pershing Company budgeted the following costs for the production of its one and only product, blades, for the next fiscal year:
Pershing has a target profit of $150,000.
-If total invested capital is $1,000,000, what is the company's target rate of return on investment?

• A)15 %
• B)20 %
• C)25 %
• D)30 %
• E)35 %

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Definitions:

Yield

The income return on an investment, typically expressed as a percentage, indicating the interest or dividends received.

Long-Term Corporate Bonds

Bonds issued by corporations with maturities longer than ten years, offering fixed interest payments.

Eurobonds

Bonds issued in a currency other than the currency of the country or market in which it is issued, often used by companies to raise capital in foreign markets.

Yankee Bonds

Bonds issued by foreign entities in the U.S. market, denominated in U.S. dollars, to raise capital from American investors.