Question detail
StyleHub serves business clients while changing promotion; the case evidence includes supplier lead time of ?5,139, sales of 604 units, and a 42% change in costs or demand. Which option best applies Calculate average rate of return for business investment projects?
Try the question, check the answer, then read the explanation to understand the curriculum point.
At a glance
MCQ
Type
practice
Style
Topic
Financial terms and calculations
Question
- A. Use investment, average rate of return to judge break-even output, employees impact, and the business objective in Average rate of return.
- B. Give only a definition of Financial terms and calculations without using the case evidence.
- C. Treat revenue and profit as identical and ignore the effect on employees.
- D. Choose the largest sales figure without checking costs, finance, or context.
Answer
The correct option is: Use investment, average rate of return to judge break-even output, employees impact, and the business objective in Average rate of return.
Explanation
The answer is commercially strongest because Use investment, average rate of return to judge break-even output, employees impact, and the business objective in Average rate of return. The case evidence gives ?6,639, 604 units, and 42%, so the answer must explain the commercial effect rather than repeat a definition. The distractors are weaker because they confuse revenue and profit, miss the employees, or ignore the business objective.
Common mistake
Average rate of return common mistake 1
Giving a vague answer instead of directly addressing: Calculate average rate of return for business investment projects..
Answer by clearly explaining how to calculate average rate of return for business investment projects..
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