A Financial Manager Is Evaluating a Project Which Is Expected

question 126

Multiple Choice

A financial manager is evaluating a project which is expected to generate profits of $100,000 per year for the next 10 years.The project should be accepted if

• A) the cost of the project is less than $1,000,000.
• B) the cost of the project is less than the present value of $100,000 per year for 10 years.
• C) this project's expected profits are higher than any other projects the corporation has available.
• D) the present value of the project's cash inflows exceeds the present value of the project's cash outflows.

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Definitions:

Wound Cleaning

The process of removing dirt, debris, and dead tissue from a wound to prevent infection and promote healing.

Epilepsy

A neurological disorder marked by sudden recurrent episodes of sensory disturbance, loss of consciousness, or convulsions, associated with abnormal electrical activity in the brain.

Seizure

A sudden, uncontrolled electrical disturbance in the brain, causing changes in behavior, movements, feelings, and levels of consciousness.

Convulsion

A sudden, uncontrolled electrical disturbance in the brain, which can cause seizures and body shakes.