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All of the following are the rates used in net present value analysis, except for the:
Suggested Answer: C
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Choice 'c' is correct. The most logical sequence in planning and controlling capital expenditures is to begin with identifying capital addition projects and other capital needs.
Choice 'a' is incorrect. Analyzing capital addition proposals omits other capital needs.
Choice 'b' is incorrect. Analyzing and evaluating all promising alternatives is beyond the scope of planning and controlling capital expenditures.
Choice 'd' is incorrect. Developing capital budgets is the same as planning and controlling capital expenditures.
51 comments · newest first
TO
Tony
11 months ago
Hurdle rate is definitely part of it, no doubt!
LI
Ligia
11 months ago
Cost of capital and discount rate are key for NPV.
ZI
Zita
11 months ago
Wait, are we sure about that? Seems off.
VE
Verda
11 months ago
Totally agree, it's not a rate for NPV!
DO
Dorian
11 months ago
The accounting rate of return isn't used in NPV analysis.
RE
Refugia
12 months ago
I’m leaning towards D as the answer since it seems like the odd one out, but I hope I’m not mixing it up with something else!
HE
Herminia
12 months ago
I practiced a similar question where we had to identify rates, and I feel like the accounting rate of return doesn't fit with the others.
GA
Gaynell
12 months ago
I think the hurdle rate is definitely used in NPV calculations, but I might confuse it with the discount rate sometimes.
AB
Abel
1 year ago
I remember studying the different rates used in NPV analysis, but I'm not entirely sure about the accounting rate of return.
AL
Alberto
1 year ago
Wait, what's the difference between the cost of capital, hurdle rate, and discount rate again? I'm getting a little mixed up on the terminology here. I better review my notes before answering.
HO
Howard
1 year ago
Okay, I've got this. The accounting rate of return is a different metric than the ones used in NPV, so that's the answer that doesn't belong in the list. I feel confident about this one.
DE
Deane
1 year ago
Hmm, I'm a little unsure about this one. The cost of capital, hurdle rate, and discount rate all seem like they could be rates used in NPV analysis. I'll have to think this through carefully.
VA
Vashti
1 year ago
This one seems pretty straightforward. The question is asking about the rates used in net present value analysis, and the answer that is not one of those rates is the accounting rate of return.
LA
Lanie
1 year ago
Hmm, I'm not totally sure about this one. I'll have to think it through a bit more. Processes could be limited to just computer systems, so I'm not 100% confident in the True answer.
MA
Mabel
1 year ago
Hmm, I'm not entirely sure. Wouldn't Traffic Sources apply if we're tracking how users got to that URL instead?
EV
Evangelina
1 year ago
I remember similar practice questions where the output was based on how constructors were defined. Could it be that the program outputs 0 followed by 1?
NI
Nicholle
1 year ago
I definitely recall that CAs get notifications about lost private keys, right? Or maybe that was just a part of a broader discussion we had in class.
JA
Jamal
1 year ago
I think option B might be the right choice, but I'm not entirely sure if it meets all the requirements for navigation.
AL
Alaine
1 year ago
The accounting rate of return? Really? I'd be accounting for my time if I chose that option.
MA
Madalyn
1 year ago
D) Accounting rate of return.
SH
Shalon
1 year ago
C) Discount rate.
AL
Aleisha
1 year ago
B) Hurdle rate.
VA
Valda
1 year ago
A) Cost of capital.
LE
Leanora
1 year ago
Haha, the accounting rate of return? What is this, an accounting exam? NPV is all about those juicy discount rates, baby!
VE
Veda
1 year ago
C) Discount rate.
MA
Maile
1 year ago
B) Hurdle rate.
TA
Tanesha
1 year ago
A) Cost of capital.
MI
Mitsue
1 year ago
Ah, I see what they're getting at. The accounting rate of return is a measure of profitability, not a rate used in NPV. Good catch!
ER
Erasmo
1 year ago
C) Discount rate.
TE
Tequila
1 year ago
B) Hurdle rate.
CO
Corinne
1 year ago
A) Cost of capital.
CA
Carrol
1 year ago
I'm pretty sure the cost of capital, hurdle rate, and discount rate are all essential for NPV calculations. The accounting rate of return seems out of place here.
RO
Roy
1 year ago
The accounting rate of return is more commonly used in other financial analysis methods.
MI
Minna
1 year ago
Yes, the cost of capital, hurdle rate, and discount rate are the main rates used in NPV calculations.
MA
Marshall
1 year ago
I agree, the accounting rate of return doesn't seem to fit in with the other rates used in NPV analysis.
LE
Leeann
1 year ago
D) Accounting rate of return.
AL
Alpha
1 year ago
C) Discount rate.
DA
Daniel
1 year ago
B) Hurdle rate.
JA
Jaclyn
1 year ago
A) Cost of capital.
GL
Glen
1 year ago
Hmm, the accounting rate of return is definitely not a rate used in NPV analysis. That's more of an accounting metric, not a financial one.
NI
Nidia
1 year ago
I agree, the accounting rate of return is not used in NPV analysis.
DE
Delfina
1 year ago
D) Accounting rate of return.
MA
Matthew
1 year ago
C) Discount rate.
FE
Fernanda
1 year ago
B) Hurdle rate.
KE
Kenny
1 year ago
A) Cost of capital.
NO
Noble
1 year ago
I'm not sure, but I think D) Accounting rate of return doesn't really fit with the other rates mentioned.
FL
Flo
1 year ago
I agree with Amina, because the other options are all related to rates used in net present value analysis.
AM
Amina
1 year ago
I think the answer is D) Accounting rate of return.
AN
Annmarie
2 years ago
I'm not sure, but I think D) Accounting rate of return doesn't belong because it's not a rate used in NPV analysis.
LE
Leonora
2 years ago
I agree with Glory, because the other options are all related to rates used in net present value analysis.
GL
Glory
2 years ago
I think the answer is D) Accounting rate of return.