Provide responses to the following questions regarding the discount rate
Question? Your response
What does the discount rate represent?
What are other names for the discount rate?
Is the following statement true? Discuss the reason for your response.
"The higher the risk, the lower the discount rate."
What will be an ideal response
Question? Your response
What does the discount rate represent? Management's minimum desired rate of return on a capital investment
What are other names for the discount rate? Required rate of return
Hurdle rate
Is the following statement true? Discuss the reason for your response.
"The higher the risk, the lower the discount rate." This statement is false. The discount rate depends on the riskiness of investments. The higher the risk, the higher the discount rate. The higher discount rate is needed to compensate for the risk that is involved.
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Which of the following is a difference between a retailer channel and a wholesaler channel?
a. A retailer channel is most common when the retailer is large and can buy in large quantities, while a wholesaler channel is commonly used for low-cost items that are frequently purchased. b. A retailer channel must be organized and managed as a group, while a wholesaler channel must be managed individually. c. A retailer channel helps differentiate a firm's final product from the competition, while a wholesaler channel does not. d. A retailer channel enables a retailer to use another manufacturer's already-established product, while a wholesaler channel does not.
Although the media often avoid mentioning a company or its brand in a news story to create the impression that they generated the facts, ideas, and photo situations, public relations practitioners often plant the seeds for many stories
Indicate whether the statement is true or false