Comment on the following statement: "Capital investment decisions always involve risk."
What will be an ideal response?
The statement is true. When firms make capital investment decisions, they must do so based on expectations about the future. Therefore, because the future is uncertain, these decisions will always involve some amount of risk.
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You operate a small poultry farm in east Texas. You sell most of your output through a regional distributor of poultry products in the area. In this case, you are subject to
a. Low buyer power b. High buyer power c. No buyer power d. All of the above
Which of the following makes someone an entrepreneur?
a) earning a lot of money as a computer programmer b) becoming a highly paid dancer c) running a service that hires people to install sprinkler systems in lawns d) inventing and selling the rights to manufacture a computer game
Refer to the above figure. If box A represents businesses and box B represents the resource market in this circular flow model, then the real flow of goods, services, and economic resources would be represented by flows:
A. (5), (6), (7), and (8). B. (7), (5), (4), and (2). C. (1), (2), (3), and (4). D. (1), (3), (6), and (8).
Refer to the below table. The marginal product of the third unit of the resource is:
A. 3
B. 4
C. 5
D. 6