Which of the Following Is an Advantage of the ROI

question 61

Multiple Choice

Which of the following is an advantage of the ROI performance measure?

• A)It encourages managers to focus on the relationship among revenues, expenses, and investment.
• B)It discourages managers from investing in projects that would decrease divisional ROI but increase the profitability of the company as a whole.
• C)It encourages managers to focus on the short run at the expense of the long run.
• D)It produces a narrow focus on divisional profitability at the expense of the profitability of the overall firm.

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Definitions:

Price

The amount of money expected, required, or given in payment for something.

Retail Clerk

A retail clerk is an employee working within a retail setting, responsible for assisting customers, processing transactions, and organizing merchandise.

Part-Time

Part-Time describes employment with fewer hours per week than a full-time job, often offering limited benefits and flexibility.

Earnings

The amount of money that a company makes from its activities, often reported as profit on a financial statement.