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Table 92 Refer to Table 9

question 82

Multiple Choice

Table 9.2 Table 9.2 Refer to Table 9.2.If a firm purchases the machine by taking out a one-year loan, what happens to the firm's rate of return on the investment if the interest rate increases to 10 percent? A) It increases to 1.5 percent B) It increases to 0.15 percent C) It decreases to 1.5 percent D) It decreases to 1.7 percent E) It decreases to 0.17 percent Refer to Table 9.2.If a firm purchases the machine by taking out a one-year loan, what happens to the firm's rate of return on the investment if the interest rate increases to 10 percent?

Definitions:

Manufacturing Accounts

Financial statements that reflect the costs and revenue associated with the manufacturing process of a company.

Process Costing

A costing method used where similar items are produced in a continuous manufacturing environment, assigning costs based on the process they go through.

Direct Materials

Direct Materials are raw materials that are directly traceable and allocable to a finished product in the manufacturing process.

Work in Process Inventory

Items currently undergoing production but have not yet reached completion.