The Accounting Rate of Return Method Evaluates the Lifetime Return

question 103

True/False

The Accounting Rate of Return method evaluates the lifetime return of an investment,whereas Return on Investment evaluates the annual return of an investment.

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Definitions:

Shareholder

A person or entity that owns part of a company through the possession of one or more shares of its stock.

Director

A person elected by the shareholders to direct corporate affairs.

Corporate Affairs

Activities and responsibilities related to the operation and management of a corporation, including compliance, governance, and public relations.

Limited Partner

One who invests in a limited partnership but does not play an active role in managing the business. Unlike general partners, limited partners are only liable for partnership debts up to the amounts they have invested.