From the view of the company as a whole,managers should accept investment projects that earn more than the ________.________ should not be used for investment decisions.
A) return on investment; Return on sales
B) return on sales; Capital turnover
C) cost of capital; Return on investment
D) capital turnover; Return on sales

Question

Quizplus · Accepted Answer

Managers should accept investment projects that earn more than the cost of capital. Return on investment can be used as a criteria for evaluating the profitability of a project, but it should not be used for investment decisions as it does not consider the cost of obtaining the investment. Return on sales and capital turnover are not relevant for investment decisions.

From the View of the Company as a Whole,managers Should