Chapter 1, Problem 12.1EC

What are two disadvantages of ROI? Explain how each can lead to decreased profitability.

Why do conflicts sometimes arise between the netpresent value (NPV) and internal rate of return(IRR) methods; that is, what conditions can leadto conflicts? Can similar conflicts arise betweenmodified internal rate of return (MIRR) andNPV rankings, or between rankings by the MIRRand IRR methods?

Why does lean accounting result in fewer transactions?

what if in the future, it will earn a negative RCE. Is this possible for a company? Why?

Which of the following is a disadvantage of outsourcing? A. freeing up capacity B. freeing up capital C. transferring production and technology risks D. limiting ability to upsize or downsize production

What is the reason that makes net profit margin increases and decreases?

Which of the following is not a correct statement O a. Profit maximization is vague conceptually. Ob. Profit Maximization ignores timing of returns. O c. Profit maximization emphasis is generally on short run projects Od. Profit maximization considers timing of returns.

If competition causes all companies to have similar ROEs in the long run, wouldcompanies with high turnovers tend to have high or low profit margins? Explainyour answer.

Which of the following is NOT something that is needed for a market to be efficient? A. A large number of buyers and sellers. B. Information being released in a random fashion. C. No transactions costs. D. None of the above. (In other words, ALL of the above are necessary for a market to be efficient.)