If the Discount Rate Is Stated in Real Terms, Then

question 9

Multiple Choice

If the discount rate is stated in real terms, then in order to calculate the NPV in a consistent manner requires that project:
I. cash flows be estimated in nominal terms
II. cash flows be estimated in real terms
III. accounting income be used

• A) I only
• B) II only
• C) III only
• D) None of the above

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