If a Project's Expected Rate of Return Exceeds Its Opportunity

question 88

Multiple Choice

If a Project's expected rate of return exceeds its opportunity cost of capital, one would expect:

• A)the profitability index to exceed 1.0.
• B)the opportunity cost of capital to be too low.
• C)the IRR to exceed the opportunity cost of capital.
• D)the NPV to be zero.

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Definitions:

Functional Design

A design approach focused on creating products, systems, or processes that prioritize functionality and efficiency to meet specific objectives.

Product Design

The process of creating and developing new products, considering their appearance and functionality.

Product Design

The process of creating and developing new products by integrating aesthetics, functionality, and usability to meet the needs and expectations of users.

Efficient Utilization

the process of using resources, such as time, money, or materials, in a way that maximizes productivity and minimizes waste or inefficiency.