Suppose a Project Requires an Initial Investment of $1,000 and It

question 108

Multiple Choice

Suppose a project requires an initial investment of $1,000 and it will yield $1,050 one year later.The NPV of the project is:

• A)equal to $50.
• B)less than 0 if the discount rate is less than 5 percent.
• C)zero if the discount rate is equal to 5 percent.
• D)positive if the discount rate is greater than 5 percent.

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Definitions:

Three Terms

In logic, particularly syllogistic reasoning, the use of three different terms to construct a conclusion derived from two premises.

Categorical Syllogism

A form of deductive reasoning consisting of three parts: two premises and a conclusion, where all statements are categorical propositions.

Conclusion

The end or finish of an event, process, or text; in logic, it is the statement that necessarily follows from the premises of an argument.

Categorical Syllogism

A form of deductive reasoning consisting of three propositions: a major premise, a minor premise, and a conclusion, each of which states a relationship between categories.