Which One of the Following Statements Is Correct

question 327

Multiple Choice

Which one of the following statements is correct?

• A) A negative net present value indicates that a project is acceptable.
• B) A profitability index that is less than 1.0 indicates that a project is acceptable.
• C) A project with a net present value of zero is earning exactly the required rate of return.
• D) When the internal rate of return is less than the required rate, the project should be accepted.
• E) If the accounting rate of return exceeds the required discount rate, the project should be accepted.

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Definitions:

Second-Price Auction

A bidding process where the highest bidder wins but pays the second-highest bid price.

Vickrey Auction

A sealed-bid auction where the highest bidder wins but pays the second-highest bid price.

Sealed Bid

A method of auction where all bids are submitted confidentially, with the highest bidder winning.

Bid-Rigging Cartel

A secretive agreement between competitors to fix bidding processes to ensure a predetermined outcome.