When Evaluating the Viability of a Project, the Test of Economic

question 5

Multiple Choice

When evaluating the viability of a project, the test of economic efficiency requires that:

• A) NPV and BCR are greater than or equal to 0.
• B) NPV is greater than or equal to 0 and BCR is greater than or equal to 1.
• C) NPV is greater than or equal to 1 and BCR is greater than or equal to 0.
• D) NPV and BCR are greater than or equal to 1.

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Definitions:

Nonconforming Goods

Products shipped to a buyer that do not meet the specifications or quality standards agreed upon in the contract.

Merchant Seller

A business or individual that sells goods to consumers in the course of their trade or business.

Nonmerchant Buyer

An individual or entity that purchases goods but does not regularly deal in goods of that kind, thus lacking certain protections and obligations under commercial law.

Risk of Loss

A legal term denoting the liability for damage to goods in a sales contract, determining who bears the risk if the goods are damaged or lost.