To Ensure That a Building Will Accommodate Expansion Plans,a New

question 69

Multiple Choice

To ensure that a building will accommodate expansion plans,a new business should:

• A)plan space requirements for one to two years into the future and update the plans every six months.
• B)build,buy,or lease facilities that are 50-100% too big for their current operations.
• C)buy or lease facilities that had the same type of business in them previously.
• D)always build a new facility.

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Definitions:

Market Interest Rate

The prevailing rate of interest that is available on investments, influencing the cost of borrowing and lending money.

Periodic Bond Interest

Regular interest payments made to bondholders during the life of a bond.

Present Value

The current value of a future sum of money or stream of cash flows given a specified rate of return, used in discounting and investment appraisal.

Bond Discount Account

An accounting term representing the difference between the face value of a bond and its selling price when sold at less than its face value.