Evaluating Capital Investment Proposals Prior to Making a Decision Falls

question 100

Multiple Choice

Evaluating capital investment proposals prior to making a decision falls under which stage of the management process?

• A)Planning
• B)Performing
• C)Evaluating
• D)Communicating

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Definitions:

Decision-Making Process

A series of steps followed by an individual or an organization to identify and evaluate options to make a choice.

Variable Costs

Expenses that vary directly with the level of production or sales volume, such as raw materials and direct labor.

Revenues

The gross increase in owner’s equity resulting from business activities entered into for the purpose of earning income.

Fixed Costs

Expenses that do not change with the level of production or sales, such as rent, salaries, and insurance.