The Rule for Project Acceptance Under the Net-Present-Value Method Is

question 55

Multiple Choice

The rule for project acceptance under the net-present-value method is that:

• A) NPV should be greater than zero.
• B) NPV should be less than zero.
• C) NPV should equal zero.
• D) NPV should be less than the hurdle rate.
• E) NPV should equal the hurdle rate.

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Definitions:

Demand Curve

A graph showing the relationship between the price of a good and the quantity of that good consumers are willing to purchase at various prices.

Marginal Cost Curve

A graphical representation that shows the change in the total cost of producing one more unit of a good.

Price Elasticity

The influence exerted by price variations on the demand level of a specific good quantified.

Price-Discriminate

The practice of charging different prices to different consumers for the same good or service, based on factors like location, buying habits, or willingness to pay.