If the Net Present Value of an Investment Is Positive

question 17

Multiple Choice

If the net present value of an investment is positive, this represents the:

• A) Net contribution margin of the investment
• B) Net profit of the investment
• C) Net tax benefit of the investment
• D) Net value gain of the investment above the hurdle rate

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Definitions:

Sarbanes-Oxley

A federal law that set new or expanded requirements for all U.S. public company boards, management, and public accounting firms.

Public Company

A corporation whose shares are traded openly on stock exchanges or markets, making its ownership public.

Small Corporations

Refers to corporations with a limited number of shareholders and reduced regulatory requirements.

Board of Directors

A group of individuals elected to represent shareholders and oversee the major decisions and policies of an organization.