The correct concerning the payback rule is rule is flawed because it ignores all cash flows after some arbitrary point in time.
Payback period in capital budgeting refers to the time required to recover funds spent on an investment or to reach breakeven. Example: If at the beginning of year 1 he invests $1,000 and at the end of year 1 and his second year he earns $500, it pays for itself within 2 years.
The number of years it will take to recover the money invested. For example, if it takes 5 years to recover the cost of an investment, the payback period is he 5 years.
Payback period is defined as the number of years required to recover the original cash investment. In other words, the period during which a machine, plant, or other investment has generated sufficient net income to cover its investment costs.
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Well it is a toy manfacturing company and the intermediate good would be a toy plane
Answer:
What to produce?
Explanation:
A society has to make choices in order to meet the diverse needs of its members. The resources available in all economies are insufficient to meet all needs. Because of this scarcity, a society has to make informed decisions on what to produce at any given.
Societies make choices on what to produce with the available resource. In every decision, there is a sacrifice to be made.
Answer: True
Explanation:
Marginal benefit is the maximum amount that a consumer will be willing to pay for an extra product. It should be known that as consumption rises, the marginal benefit starts reducing.
The marginal cost is the extra cost that a producer incurs when an extra unit of a product is made. Economic decisions made by economic agents are typically based on marginal as it'll be possible to know the impact of an extra decision made on a variable.
Therefore, it is better to evaluate economic decisions at the marginal, where the decision has to be made as long as its marginal benefit exceeds its marginal cost, if not equal to its marginal cost.
