The Net Present Value Method Compares a Project's Future Net

question 71

True/False

The net present value method compares a project's future net income to the initial investment.The net present value method compares the present value of a project's future cash flows to the initial investment.

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Definitions:

Cash Surplus

A situation where a business or individual's income exceeds its expenditures, resulting in available cash for saving or spending.

Cash Balance

The amount of cash that a company or individual has on hand at any given time.

Minimum Cash Balance

Minimum Cash Balance is the least amount of cash a company aims to hold in its register or account to meet emergency needs or unforeseen expenses.

Sales Collection

The process of retrieving payment for goods or services provided, typically managed through invoicing and accounts receivable procedures.