A firm is trying to determine which of two products it should launch. Product A has an expected life of three years. It will bring in cash flows of $10,000 in each of the three years. Product B has an expected life of two years. It will bring in cash flows of $15,000 in each of the two years. Assume a discount rate of 8%. Which product should the firm, based on NPV alone, select?
a. Product A
b. Product B
c. Product A and B are equivalent
d. NPV for the products cannot be calculated with the information given.
b. Product B
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In assessing whether to accept a client for an audit engagement, a CPA should consider:
A. the CPA's overall engagement risk. B. the current financial health of the prospective client. C. the integrity of management. D. All of these choices are correct.
You are working with a sales management consultant on ways to improve your company's sales performance. Your company sells high-end consumer products. You and the consultant agree your promotional activities need to include more direct interaction with your customers. Based on this information, which of the elements of promotion should you emphasize more?
A. Advertising B. Sales promotions C. Personal selling D. Public relations E. Discounting
Efficient supply chains use low capacity cushions
Indicate whether the statement is true or false
In a recent comprehensive survey, corporate CFOs were asked why they did NOT use more equity in their capital structure. Which of the following choices was NOT cited by 50% or more of the CFOs responding to the survey?
A) EPS dilution B) Concerns that equity was not the least expensive form of financing C) Concerns that share price might decline D) All of the above were cited by at least 50% of the responding CFOs.