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The program selection committee presents several programs for approval:
Program A is estimated to cost US$250,000, and has an annual cash inflow of US$75,000. Program B is estimated to cost US$150,000, and has an annual cash inflow of US$55,000. Program C is estimated to cost US$100,000, and has an annual cash inflow of US$45,000. Program D is estimated to cost US$200,000, and has an annual cash inflow of US$35,000.
Which program was selected based solely on a three-year return on investment?
Suggested Answer: C
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12 comments · newest first
LO
Louisa
12 months ago
A's ROI is definitely better than the others!
WH
Whitley
1 year ago
Program B looks decent too, though.
JE
Jerlene
1 year ago
Wait, are we sure about these numbers?
PE
Pete
1 year ago
Totally agree, A is the best choice.
HE
Herman
1 year ago
Program A has the highest cash inflow!
ME
Melita
1 year ago
I practiced a similar question where we had to find the payback period. I wonder if that applies here too?
RO
Rocco
1 year ago
If I recall correctly, Program A has the highest cash inflow, but I need to double-check the calculations for the others.
CY
Cyndy
1 year ago
I'm not entirely sure, but I remember something about comparing the initial costs with the cash inflows.
MA
Malcom
1 year ago
I think we need to calculate the total cash inflow for each program over three years to determine the ROI.
RO
Roslyn
1 year ago
I'm not totally sure about this one. I'll have to weigh the pros and cons of each dome type to decide.
BE
Beckie
1 year ago
Okay, let me think this through. I believe the main output is information to improve the Business Case, so I'll select option C.
DE
Delisa
1 year ago
Hmm, this seems like a tricky one. I'll need to think carefully about the key terms in the question to determine the right answer.