Which of the Following Assumptions Is Made in Order to Simplify

question 62

Multiple Choice

Which of the following assumptions is made in order to simplify the net present value method?

• A)All cash flows come at the end of the year.
• B)All cash flows are immediately reinvested at the best rate available at the time.
• C)All cash flows come at the beginning of the year.
• D)All cash flows are not reinvested.

---

Definitions:

Breach of Contract

Occurs when one or more parties involved in a contract fail to fulfill their legal obligations as stipulated in the agreement, potentially leading to legal action for damages or specific performance.

Purchase Order

A document issued by a buyer to a seller, indicating types, quantities, and agreed prices for products or services.

Goods

Tangible, movable objects intended for sale or personal use, excluding real estate and intangible items.

Risk of Loss

The potential that an asset or investment will decrease in value or become worthless, also refers to the responsibility for damage or loss of goods in commerce.