An Advantage of the Net Present Value Method for Evaluating

question 51

Multiple Choice

An advantage of the net present value method for evaluating investment proposals over the internal rate of return method is that:

• A)only one set of present value calculations using a required discount rate is made.
• B)the actual rate of return on the project is calculated.
• C)projects can be ranked in order of profitability using the net present value amount.
• D)estimates of future cash flows do not have to be made.

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Definitions:

Sensory Crossover

The phenomenon where stimulation of one sensory pathway leads to automatic experiences in a second sensory pathway.

Synesthesia

A condition in which one sense is simultaneously perceived as if by one or more additional senses, such as seeing sound.

Specific Nerve Energies

The theory that different sensory nerves convey specific sensations to the brain.

Sensory Receptor

A specialized neuron that detects a specific type of stimulus and converts it into an electrical signal in the nervous system.