Gamma Division
the Manager of Gamma Division Projects the Following $$\begin{array} { l l } \text { Sales } & \$ 100,000 \\\text { Operating income } & \$ 30,000 \\\text { Operating assets } & \$ 200,000\end{array}$$

question 97

Multiple Choice

Gamma Division
The manager of Gamma Division projects the following for next year: $$\begin{array} { l l } \text { Sales } & \$ 100,000 \\\text { Operating income } & \$ 30,000 \\\text { Operating assets } & \$ 200,000\end{array}$$ The manager can invest in an additional project that would require $30,000 investment in additional assets and would generate $4,200 of additional income. The company's minimum rate of return is 12%.
-Refer to Gamma Division . What will happen to the company if the manager invests in the additional project?

• A) ROI of the division will increase.
• B) Average investment for will decrease.
• C) Residual income of the division will increase.
• D) There will be no impact on ROI or residual income.

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Definitions:

Reconstructive Process

A cognitive process involved in the remembrance of past events, where memories are often reconstructed rather than played back exactly.

Sir Frederic Bartlett

A pioneering British psychologist known for his work in cognitive psychology, especially on memory and schema theory.

Emotional Memories

Memories that are strongly influenced by the emotions felt at the time of the event, which can significantly impact the way those memories are recalled.

Confabulation

A memory disturbance, the production of fabricated, distorted, or misinterpreted memories about oneself or the world, without the conscious intention to deceive.