Suppose a Project Requires an Initial Investment of $1,000 and It

question 3

Multiple Choice

Suppose a project requires an initial investment of $1,000 and it will yield $1,050 one year later.The NPV of the project is:

• A)Equal to $50
• B)less than 0 if the discount rate is less than 5 percent
• C)Zero if the discount rate is equal to 5 percent
• D)Positive if the discount rate is greater than 5 percent

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Definitions:

Internal Revenue Service

The Internal Revenue Service (IRS) is the agency of the U.S. government tasked with collecting taxes and enforcing the laws related to taxes.

Government in the Sunshine Act

A U.S. law aimed at ensuring that agencies conduct their meetings in public, promoting transparency.

Public Observation

The act of watching, monitoring, or scrutinizing activities, processes, or events by the general public, often for oversight or interest purposes.

Administrative Inspections

Routine examinations or checks conducted by governmental agencies to ensure compliance with laws, regulations, and standards.