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11. The MSG Corporation had net operating income of $380,000 and average operating assets of $2,000,000. The corporation's minimum required return on new projects is
11. The MSG Corporation had net operating income of $380,000 and average operating assets of $2,000,000. The corporation's minimum required return on new projects is 18%. The U.S. Division of the corporation is considering an investment of $70,000 in a project that will generate a net income of $12,000. The US. Division currently earns a return on investment rate of 20% The US division manager can be evaluated based on either the division's ROI (return on investment) or the division's RI (residual income). Which of the following is true? A. The US Division manager would invest in the new project only if the division's ROI is used for evaluating the division manager B. The US Division manager would invest in the new project only if the division's RI is used for evaluating the division manager. C. The US Division manager would never invest in the new project whether the division's ROI or RI is used for evaluating the division manager. D. The US Division manager would always invest in the new project whether the division's ROI or RI is used for evaluating the division manager. 11. The MSG Corporation had net operating income of $380,000 and average operating assets of $2,000,000. The corporation's minimum required return on new projects is 18%. The U.S. Division of the corporation is considering an investment of $70,000 in a project that will generate a net income of $12,000. The US. Division currently earns a return on investment rate of 20% The US division manager can be evaluated based on either the division's ROI (return on investment) or the division's RI (residual income). Which of the following is true? A. The US Division manager would invest in the new project only if the division's ROI is used for evaluating the division manager B. The US Division manager would invest in the new project only if the division's RI is used for evaluating the division manager. C. The US Division manager would never invest in the new project whether the division's ROI or RI is used for evaluating the division manager. D. The US Division manager would always invest in the new project whether the division's ROI or RI is used for evaluating the division manager
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