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CPA - Certified Public Accountant
What is the primary disadvantage of using return on investment (ROI) rather than residual income (RI) to evaluate the performance of investment center managers?
ROI is a percentage, while RI is a dollar amount.
ROI may lead to rejecting projects that yield positive cash flows.
ROI does not necessarily reflect the company's cost of capital.
ROI does not reflect all economic gains.
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