In a Capital Budgeting Decision, If a Firm Uses the Net

question 56

Multiple Choice

In a capital budgeting decision, if a firm uses the net present value method and a 12% discount rate, what does a negative net present value indicate?

• A) The proposal's rate of return exceeds 12%.
• B) The proposal's rate of return is less than the minimum rate required.
• C) The proposal earns a rate of return between 10% and 12%.
• D) None of these.

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Definitions:

Extraversion

A personality trait characterized by high levels of enthusiasm, sociability, and assertiveness.

Self-Esteem

A person’s attitude toward him- or herself.

Lowest Self-Esteem

Refers to the lowest level of an individual's appraisal of their own worth or value.

Reference-Group Effect

When people compare themselves to other people they know when completing personality questionnaires.