If the Net Present Value of a Proposed Investment Is

question 61

Multiple Choice

If the net present value of a proposed investment is positive:

• A)the cost of the investment is more than the present value of the future cash flows.
• B)the investment does not earn the required rate of return.
• C)the present value of the future cash flows would be unaffected by the proposed investment.
• D)the business should make the investment because the present value of the future cash flows is more than the cost of the investment.

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Definitions:

Correct Answer

An accurate response or solution to a particular question or problem.

Mental Retardation

An outdated and insensitive term formerly used to describe individuals with below-average intellectual functioning and significant limitations in adaptive behaviors; now more commonly referred to as intellectual disability.

Giftedness

The possession of natural talents or abilities at levels significantly higher than average.

IQ

Intelligence Quotient, a measure of a person's intellectual abilities in relation to their age group, typically assessed through standardized testing.