Profitability Index Is The

question 2

Multiple Choice

Profitability index is the:

• A)difference between a present value of the project?s future cash flows and the cost of implementing the project.
• B)present value of a project?s future cash flows divided by the initial cost of the project.
• C)ratio of initial cost of a project to the total cash inflows from the project.
• D)accounting profit earned on a project divided by the amount invested to acquire the project?s assets.

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Definitions:

Comparative Advantages

The ability of an entity to produce goods or services at a lower opportunity cost than others, leading to more efficient economic outcomes.

Grammar

The set of rules and principles that govern the structure of sentences in a language.

Wikis

Collaborative websites or databases allowing users to add and edit content freely, often used for gathering and sharing information on various topics.

Immediacy

The quality of bringing one into direct and instant involvement with something, giving a sense of urgency or importance.