Why is the personal decision a financial manager makes as to whether to buy or to rent an apartment as a personal residence most like the professional decision that a manager makes as to whether his/her firm should try to acquire a stake in a fast-growing new internet-based company?
A)Both decisions involve the purchase of assets.
B)Both decisions should be made based upon the trade-off between benefits and costs across time.
C)Both decisions are vital to the financial health of the decision maker.
D)Both decisions will be made based on what provides the greatest long-term benefit.

Question

Quizplus · Accepted Answer

Both decisions involve evaluating the benefits and costs over time. In the case of renting versus buying, the financial manager must consider the monthly costs of renting versus the long-term benefits of owning a property. Likewise, in the case of acquiring a stake in a fast-growing internet-based company, the manager must evaluate the potential benefits and costs of investing over time. Both decisions require a careful analysis of the costs and benefits involved in order to make an informed decision.

Why Is the Personal Decision a Financial Manager Makes as to Whether