The decision criterion for the accounting rate of return is consistent with the goal of shareholder wealth maximization.

Name: The decision criterion for the accounting rate of return is consistent with the goal of shareholder wealth maximization.
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Question

Quizplus · Accepted Answer

The accounting rate of return (ARR) focuses on accounting profits rather than cash flows and does not consider the time value of money, making it inconsistent with the goal of maximizing shareholder wealth.

The Decision Criterion for the Accounting Rate of Return Is