Positive NPV Projects Most Often Occur Because

question 43

Multiple Choice

Positive NPV projects most often occur because:

• A)analysts select sufficiently low discount rates.
• B)most projects are unique and innovative.
• C)cash-flow projections are extended into the future.
• D)of competitive advantages held by firms.

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Definitions:

Utilities Possibilities Frontier

Represents the maximum utility levels that two individuals or more can achieve within a given set of resources, emphasizing trade-offs and efficiency.

Efficient

An economic state where every resource is optimally allocated to serve each individual or entity in the best way while minimizing waste and inefficiency.

Marginal Utility

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

Apples

A common fruit consumed worldwide, often used as an example in economic models and comparisons.