Which of the Following Statements Is MOST Correct

question 18

Multiple Choice

Which of the following statements is MOST correct?

• A) If a project's internal rate of return (IRR) exceeds the required return, then the project's net present value (NPV) must be negative.
• B) If Project A has a higher IRR than Project B, then Project A must also have a higher NPV.
• C) The IRR calculation implicitly assumes that all cash flows are reinvested at a rate of return equal to the IRR.
• D) A project with a NPV = 0 is not acceptable.

---

Definitions:

Graph

A visual representation of data, utilizing points, lines, bars, or symbols to demonstrate relationships or patterns among variables.

Visual Representation

The use of charts, graphs, or diagrams to present data and information visually.

Numerical Values

Quantitative data represented in numbers, as opposed to qualitative information which includes descriptions and categorizations.

Histogram

A type of graph representing the distribution of numerical data, using bars to show the frequency of different ranges of values.