Answer:
This project should be rejected because the AAR is 10.68 percent.
Explanation:
The accounting rate of return of the project needs to computed,compared with the required accounting rate of return in order to decide whether the project should accepted or rejected:
Profit margin=$86,800*6%=$5208
Average operating assets=($97,500+$0)/2=$48.750
Accounting rate of return=profit margin/average operating assets*100
Accounting rate of return=$5,208/$48,750*100=10.68%
The project accounting rate of return is lower than the required accounting rate of return,hence the project should be rejected.
Answer: Improve the ad’s quality score.
Explanation:
Rina should try to improve her ad's quality score because even if you pay for an ad, it is not a guarantee that your ad will be picked if it does not have a good quality score.
There will be other people like her who have paid for ads and if hers is not as high quality as theirs, the search engine's search bots will pick those ones up more which would leave her ads lower on the ad hierarchy.
She can try to improve ad quality by including relevant ads and giving users a better landing page experience.
Answer:
Reject,
Explanation:
When calculating the IRR, I got 16.6%, which is less than the wacc. This means that the rate of return is lower than what it costs 18% wacc.
I think the answer should be reject, less.