Given a Positive Discount Rate, Which One of the Following

question 59

Multiple Choice

Given a positive discount rate, which one of the following changes would increase the NPV of a project?

• A) Increasing the firm's opportunity cost of capital
• B) Realizing a net decrease in working capital
• C) Spreading the total cash inflows over a longer time interval
• D)Increasing the project's estimated expenses

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Definitions:

Real GDP Growth Rates

The rate at which the inflation-adjusted value of all goods and services produced in a country grows over a specified period of time.

Rich Countries

Nations with high levels of income per capita, advanced infrastructure, and a high standard of living among their populations.

Economic Growth

An increase in the production of goods and services in an economy over a period of time, typically measured by GDP.

Real GDP Per Person

The inflation-adjusted value of goods and services produced per individual in a country.