Which Statement Concerning the Net Present Value (NPV) of an Investment

question 32

Multiple Choice

Which statement concerning the net present value (NPV) of an investment or a financing project is correct?

• A) a financing project should be accepted if, and only if, the NPV is exactly equal to zero.
• B) an investment project should be accepted only if the NPV is equal to the initial cash flow.
• C) any type of project should be accepted if the NPV is positive and rejected if it is negative.
• D) any type of project with greater total cash inflows than total cash outflows, should always be accepted.
• E) an investment project that has positive cash flows for every time period after the initial investment should be accepted.