Most companies useresidual income in evaluating projects, not ROI.
举一反三
- In general, forcompanies using ROI, the most profitable divisions have more incentive toinvest in new projects than do the least profitable divisions.
- ROI=income(orprofit)/investment.
- In general, use ofresidual income or EVA will promote goal congruence and lead to betterdecisions than using ROI.
- When companies maximizeresidual income, they are maximizing their rate of return, a percentage.
- Most of the projects concerning the Grand Canal were carried out in ____.