Final answer:
The rate of return on an investment does have an effect on an investment program. It measures the profitability of an investment and helps investors evaluate the potential risks and rewards.
Step-by-step explanation:
The statement that the rate of return on an investment has no effect on an investment program is false. The rate of return on an investment is a crucial factor in determining the success or failure of an investment program. It measures the profitability of an investment and helps investors evaluate the potential risks and rewards. A higher rate of return indicates a more profitable investment, while a lower rate of return may not justify the investment.
For example, consider two investment programs with different rates of return. Program A offers a 10% rate of return, while Program B offers a 5% rate of return. If all other factors such as risk and investment duration are the same, a rational investor would prefer Program A because it offers a higher rate of return, which means greater potential profitability.
Therefore, it is important for investors to carefully consider the rate of return on an investment as it directly affects the outcome of an investment program.