All of the Following Statements Are Correct Except

question 35

Multiple Choice

All of the following statements are correct except:

• A) The NPV and IRR methods will always agree on whether a project enhances or harms shareholder wealth.
• B) If a project has a positive NPV, its IRR will always be greater than the cost of capital.
• C) If a project has a negative NPV, its IRR will always be less than the cost of capital.
• D) There is always a conflict between NPV and IRR in the case of mutually exclusive projects.

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Definitions:

Consumption

The use of goods and services by households, which is a primary component in calculating a country's gross domestic product (GDP).

Marginal Utilities

The additional satisfaction or utility gained from consuming one more unit of a good or service.

Consumption Bundle

A combination of various goods and services that an individual consumes over a given period.

Preferences

The subjective tastes and priorities of consumers, influencing their choices among different goods, services, or outcomes.