Answer to Question #253168 in Civil and Environmental Engineering for nato

Question

"The higher the MARR, the higher the price that a company should be willing to pay for equipment that reduces annual operating expenses." Do you agree with this statement? Explain why.

Answer 1

A hurdle rate, which is also known as minimum acceptable rate of return (MARR), is the minimum required rate of return or target rate that investors are expecting to receive on an investment.

No, I would not agree with the statement because the inventories are considered an asset since they are significant resources with value owned by business entities.

Inventories are not a liability since it is an accountability to pay for anything.