Which Model Is Preferred for Choosing the Best of Several

question 135

Multiple Choice

Which model is preferred for choosing the best of several competing projects?

• A) the payback period
• B) the net present value
• C) the internal rate of return
• D) the accounting rate of return

---

Definitions:

Supply Function

A mathematical representation that shows the relationship between the quantity of a good supplied and its price.

Subsidy

A subsidy is a financial contribution provided by government or another authority to support businesses, markets, or individuals, aiming to promote economic and social policies.

Inverse Demand Function

A mathematical relationship expressing the price of a good or service as a function of the quantity demanded, implying how prices vary with changes in quantity demanded.

Inverse Supply

A concept in economics where the supply curve is expressed as a function of price rather than quantity supplied.