The Mutually Exclusive Project with the Highest Positive NPV Will

question 95

True/False

The mutually exclusive project with the highest positive NPV will also have the highest IRR.

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Definitions:

Yield To Maturity

The expected total yield on a bond when held until the expiration of its term.

Coupon Rate

The yearly rate of return on a bond, shown as a percentage of its nominal worth.

Discount Rate

The interest rate that the Federal Reserve charges banks for short-term loans, or a rate used to discount future cash flows to present value.

Par Value

The face value of a bond or stock, typically the amount paid at maturity for bonds and the nominal value for stocks.