Examlex
Which of the following statements is true?
Discount Rate
The interest rate used to discount future cash flows to their present value, often relevant in investment and finance decisions.
Capital Budgeting
The process by which a business evaluates and selects major capital investments based on their potential to generate additional revenue or reduce costs.
Simple Rate of Return
A method to evaluate the profitability of an investment by dividing the annual incremental net operating income by the initial investment cost.
Operating Expenses
Costs associated with a company’s operational activities, excluding direct labor and materials, that are necessary to run the business.
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