The Net Present Value (Or NPV)criteria for Capital Budgeting Decisions

question 76

Multiple Choice

The Net Present Value (or NPV) criteria for capital budgeting decisions assumes that expected future cash flows are reinvested at ________,and the Internal Rate of Return (or IRR) criteria assumes that expected future cash flows are reinvested at ________.

• A) the firm's discount rate; the internal rate of return
• B) the internal rate of return; the internal rate of return
• C) the internal rate of return; the firm's discount rate
• D) Neither criteria assumes reinvestment of future cash flows.

---

Definitions:

Inner Ear

The innermost part of the ear, containing the cochlea, vestibule, and semicircular canals, responsible for hearing and balance.

Five Senses

The traditional set of senses used for perception: sight, hearing, taste, smell, and touch.

Sensory Threshold

The minimum level of stimulus intensity needed for a stimulus to be perceived.

Stimulation

The act of arousing or urging into action, often by providing an external stimulus to trigger a response.