Scott\'s Scottish Golf Links is contemplating an investment of $50,000 in new gr

ID: 1092717 • Letter: S

Question

Scott's Scottish Golf Links is contemplating an investment of $50,000 in new groudkeepings equipment

Managment of this company predict a 4.7 percent annual return on this investment

The current market rate of interest is 9.8 percent. Scotts Scottish Golf Links will

A. not make the investment since the cost is greater than the expected return.

B. Make the investment since the cost is less than the expected return

C. not make the investment since the cost is less than the expected return

D. make the investment since the cost is greater than the expected return

At which of the market rates of interest below would scotts scottish Golf links be inclined to make the investment?

A.2%

b. 3.5%

c. 3%

d. at any of these interest rates listed.

a. not make the investment since the cost is greater than the expected return.

b. at any of these interest rates listed.

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