A Project Manager Is Using the Payback Method to Make

question 38

Multiple Choice

A project manager is using the payback method to make the final decision on which project to undertake.The company has a 15% required rate of return and expects a 5% rate of inflation for the following five years.What is the discounted payback of a project that has cash flows as shown in the table? $$\begin{array} { | l | l | } \hline \text { Year } & \text { Cash Flow } \\\hline 0 & - \$ 500,000 \\\hline 1 & \$ 50,000 \\\hline 2 & \$ 75,000 \\\hline 3 & \$ 150,000 \\\hline 4 & \$ 150,000 \\\hline 5 & \$ 750,000 \\\hline\end{array}$$

• A) 3.9 years
• B) 4.3 years
• C) 4.6 years
• D) 4.1 years

Distinguish between mutual funds based on their investment strategies, such as growth, sector, or high-yield bond funds.

Appreciate the role of fund managers and the significance of different investment options within mutual funds.

Understand the different strategies of corporate social responsibility (CSR) and their implications.

Identify the legal, ethical, economic, and discretionary responsibilities of organizations.

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Definitions:

Demand

The quantity of a product or service consumers are willing and able to purchase at various price levels.

Convenience Store Products

Items sold in convenience stores, often including snacks, beverages, tobacco products, and household essentials.

Gas Sales

Transactions involving the purchase and sale of gas, either in its natural form or after processing, typically for the purpose of energy production or heating.

Complements

Goods or services that are used together, where the demand for one item increases the demand for another.