The Key Steps Followed by the Managers in Capital Investment

question 38

Multiple Choice

The key steps followed by the managers in capital investment analysis include all of the following except

• A) identification of capital investment needs
• B) preliminary screening
• C) formal requests for capital investments
• D) sunk costs.

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Definitions:

Input Market

The market in which firms purchase raw materials, labor, services, and other inputs necessary for the production of goods or services.

Salvage Value

The estimated resale value of an asset at the end of its useful life.

Expected Benefit Approach

A method used in actuarial science and finance to calculate the anticipated benefits and corresponding costs or contributions to a pension plan over time.

Output Market

The marketplace in which goods and services produced by businesses are sold or offered to end users or consumers.