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A manager i5 evaluated based on return on investment. The corporate minimum required return i5 11 percent and the manager runs a division that has
A manager i5 evaluated based on return on investment. The corporate minimum required return i5 11 percent and the manager runs a division that has attained a 14 percemi return on Investment. Which Of the Iollewing statements is true? 0 The manager will most likely not invest in a project that has a return on investment oi 13 percent. C'- The manager will invest ln all projects that increase operating income. .3 The manager will not consider projec1s that exceed 14 percent. .fj; The manager may preter to invest in projects that have a return on investment that is very close 11 percent to stay in line with corporate expectations. An adjustment is made to net income when calculating residual income to remove O noninterest-bearing current liabilities. interest and the related tax effect. O financing costs that the manager is able to control. O accounting distortions
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