Many Firms Combine Net Present Value and Payback When Analyzing

question 75

Multiple Choice

Many firms combine net present value and payback when analyzing project risk. Which of the following statements is (are) correct?
I. Both payback and net present value consider the frequency of cash flows.
II. Both payback and net present value can be adjusted for risk.

• A) Only statement I is correct.
• B) Only statement II is correct.
• C) Both statements I and II are correct.
• D) Neither statement I nor II is correct.

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Definitions:

Variant

An individual or group that exhibits differences in physical traits, behavior, or genetic composition from the typical or expected form.

Tumor-Suppressor Gene

A tumor-suppressor gene is a gene that suppresses cell growth and proliferation. Many tumor-suppressor genes are transcription factors activated by stress or DNA damage that arrest mitosis until DNA can be repaired. Mutations interfering with their expression can lead to excessive proliferation and cancer.

Oncogene

An oncogene is a normal gene whose function, when altered by mutation, has the potential to cause cancer.

BRCA1

A gene associated with a higher risk of breast and ovarian cancer when mutated; it plays a crucial role in DNA repair.