The Appropriate Discount Rate That Analysts Use in Computing the Present

question 97

Multiple Choice

The appropriate discount rate that analysts use in computing the present value of future cash flows is composed of a pure interest rate,a premium for the risk of the investment,an increase to reflect expected inflation.What is this rate is called?

• A)risk-free rate.
• B)real interest rate.
• C)nominal interest rate.
• D)none of the above.

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Definitions:

Source Of Resistance

Factors or forces that oppose or hinder change within an organization, often stem from psychological, social, or structural reasons.

Limited Focus

The tendency to concentrate one's attention narrowly on a specific aspect or task, sometimes excluding wider considerations.

Departmentalization

the process of dividing an organization into different departments, which perform tasks according to the departments' specialties.

Organizational Structure

The system of task, workflow, and reporting relationships within an organization; it defines how activities are directed toward achieving the organization's goals.