A Project Has a Required Return of 15% and a Five

question 356

Multiple Choice

A project has a required return of 15% and a five year life. Which of the following is inconsistent with the other four?

• A) The discounted payback is five years
• B) PI = 0
• C) NPV = $0
• D) IRR = 15%
• E) The present value of the future cash flows equals the initial outlay

---

Definitions:

Upward Slope

In economics, it typically represents an increase or positive trend in a graph, such as rising prices or increasing production over time.

Keynesian Economics

A theory that advocates for increased government expenditures and lower taxes to stimulate demand and pull the global economy out of depression.

Downward Rigidity

A situation in economics where wages or prices are resistant to decrease even in conditions where they logically should, such as during a recession.

Classical Model

An economic theory emphasizing that markets function best without government interference, focusing on long-term growth by ensuring goods and labor markets are in equilibrium.