Which of the Following Statements Is CORRECT? Assume That All

question 32

Multiple Choice

Which of the following statements is CORRECT? Assume that all projects being considered have normal cash flows and are equally risky.

• A) If a project's IRR is equal to its WACC,then,under all reasonable conditions,the project's NPV must be negative.
• B) If a project's IRR is equal to its WACC,then under all reasonable conditions,the project's IRR must be negative.
• C) If a project's IRR is equal to its WACC,then under all reasonable conditions the project's NPV must be zero.
• D) There is no necessary relationship between a project's IRR,its WACC,and its NPV.
• E) When evaluating mutually exclusive projects,those projects with relatively long lives will tend to have relatively high NPVs when the cost of capital is relatively high.

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Definitions:

Ethnopharmacology

The study of the effect of ethnicity on responses to prescribed mediation.

Angiotensin Converting Enzyme Inhibitors

A class of drugs used primarily to treat hypertension and congestive heart failure by relaxing blood vessels.

Decreased Response

A reduction in the effectiveness or intensity of a reaction or behavior typically observed in biological, chemical, or social processes.

Safe Range

The interval within which a particular parameter (such as medication dosage, temperature, etc.) is deemed effective and not harmful.