On the Basis of the Above Data,which of the Following

question 34

Multiple Choice

On the basis of the above data,which of the following is false?

• A)Proposal A should be considered unacceptable.
• B)Proposal C is the best alternative because it has the shortest payback period,which is the most meaningful of the capital budgeting statistics.
• C)Proposal A's negative net present value indicates that this alternative will not generate management's required rate of return.
• D)Although proposals B and C are each acceptable,proposal B is a better investment considering the time value of money.

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Definitions:

Imperfectly Competitive

A market structure where individual firms have some control over the price of their products due to factors like brand differentiation and barriers to entry.

Future Value

The value of an investment or sum of money at a specified future date, calculated by applying a rate of interest or return.

Stock Portfolio

A collection of stocks owned by an individual or an institution, managed as a single entity with specific investment goals and strategies.

Equilibrium Interest Rate

The interest rate at which the demand for funds equals the supply of funds, balancing savings and investments.