Given a Particular Set of Project Cash Flows, Which of the Following

question 19

Multiple Choice

Given a particular set of project cash flows, which of the following statements is correct?

• A)There can be only one NPV for the project
• B)There can be only one IRR for the project
• C)There can be more than one NPV for the project
• D)There can be only one profitability index for the project

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Definitions:

Total Product

The total quantity of output produced by a firm over a given period of time.

Average Product

The output per unit of a particular input, calculated by dividing total output by the quantity of inputs.

Labor

Human effort, either physical or mental, used in the production of goods and services.

Average Product

The output per unit of input, calculated by dividing the total output by the number of units of the input.