The Decision Technique That Measures the Estimated Performance of a Capital

Multiple Choice

The decision technique that measures the estimated performance of a capital investment by dividing the project's annual after-tax income by the average investment cost is called the:

A) Break-even point for the project.
B) Internal rate of return (IRR) on the proposed investment.
C) Accounting (book) rate of return (ARR) on the investment.
D) Capital asset pricing rate of return.
E) Profitability index (PI) for the investment.