Why is the search for new profitable projects so important?
What will be an ideal response?
Without question it is easier to evaluate profitable projects or investments in fixed assets, a process referred to as
capital budgeting, than it is to find them. In competitive markets, generating ideas for profitable projects is extremely
difficult. The competition is brisk for new profitable projects, and once they have been uncovered, competitors
generally rush in, pushing down prices and profits. For this reason a firm must have a systematic strategy for
generating capital-budgeting projects based on these ideas. Without this flow of new projects and ideas, the firm
cannot grow or even survive for long. Instead, it will be forced to live off the profits from existing projects with limited
lives. So where do these ideas come from for new products, or for ways to improve existing products or make them
more profitable? The answer is from inside the firm–from everywhere inside the firm, in fact.
You might also like to view...
After closing the temporary owners' equity accounts into Income Summary, and after allocating the net income and closing the partners' drawing accounts, assume the partners' capital accounts had credit balances as follows: Rhodes, $40,000; Serrata, $60,000; Shepard, $75,000 . Partners share profits and losses as follows: Rhodes, 20%; Serrata, 30%; and Shepard, 50%. If Shepard retired and withdrew
$85,000 in settlement of his equity and settlements are allocated according to capital interests, the amount entered in Rhodes' capital account would be a a. $4,000 debit. b. $4,000 credit. c. $6,000 debit. d. $6,000 credit.
Distributive bargaining considers negotiations as zero-sum or constant-sum bargaining.
Answer the following statement true (T) or false (F)
Assume that it takes 100 hr to produce the first unit of a product, and the learning rate for this production process is 80%. Using the arithmetic approach, determine the labor hours required to produce the fourth unit.
A. 100 hr B. 80 hr C. 64 hr D. 52 hr
A free trade area is a group of two or more sovereign countries in which import duties and other trade barriers are reduced or eliminated
Indicate whether the statement is true or false