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Supercircuits Is a Decentralized Company and Has a Required Opportunity

Question 42

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Supercircuits is a decentralized company and has a required opportunity cost of capital of 15%. The home computer division, whose current ROI is 10%, is considering an investment which will earn a 13% return. The gaming division, whose current ROI is 20%, is considering an investment which will earn a 17% return. If the objective is to maximize residual income, each division will make the following choice: Supercircuits is a decentralized company and has a required opportunity cost of capital of 15%. The home computer division, whose current ROI is 10%, is considering an investment which will earn a 13% return. The gaming division, whose current ROI is 20%, is considering an investment which will earn a 17% return. If the objective is to maximize residual income, each division will make the following choice:

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