A Firm Has a Project with an NPV of −$52

question 46

Multiple Choice

A firm has a project with an NPV of −$52 million. If it has access to risk-free government financing that can create a permanent annual tax shield of $5 million, what is the APV of the project assuming the risk-free interest rate is 6 percent?

• A)−$52 million
• B)$5 million
• C)$31 million
• D)$83 million

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Definitions:

Structurally Available Means

Refers to the resources and opportunities that are distributed within a society, affecting individuals' ability to achieve goals.

Merton

Merton refers to Robert K. Merton, an influential 20th-century sociologist known for developing theories on social structure, anomie, and the sociology of science.

Differential Association Theory

A theory in criminology that asserts criminal behavior is learned through regular interaction with others who engage in crime.

Deviant Behavior

Conduct that breaches the standards or norms expected by society.