If the Net Present Value of a Project Is $1,000

question 57

Multiple Choice

If the net present value of a project is $1,000 after using a discount rate of 8%, then one can conclude that the internal rate of return is:

• A) less than 8%.
• B) between 8% and 10%.
• C) greater than 8%.
• D) 8%.

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Definitions:

Materials Quantity Variance

The difference between the actual quantity of materials used in production and the standard expected quantity, multiplied by the standard cost per unit.

Standard Pounds

A measurement unit used to standardize or reference weight in the production or processing of materials.

Labor Quantity Standard

The predetermined amount of labor time expected to be consumed during the production of a good or service.

Downtime

The period during which an asset or system is not operational or productive, often due to maintenance or repair.