Should a Project Be Accepted If It Offers an Annual

question 99

Multiple Choice

Should a project be accepted if it offers an annual after-tax cash flow of $1,250,000 indefinitely,costs $10 million,is riskier than the firm's average projects,and the firm uses a 12.5% WACC?

• A) Yes, since NPV is positive.
• B) Yes, since a zero NPV indicates marginal acceptability.
• C) No, since NPV is zero.
• D) No, since NPV is negative.

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Definitions:

Dominant Ideology

The set of beliefs, values, and norms that are widely shared and accepted within a society, often serving to maintain the power of the ruling class or group.

Ideal Culture

The values, norms, and behaviors that a society or group considers desirable and strives for, often contrasted with real culture, which reflects actual behavior and norms.

Cultural Capital

The range of non-financial social assets that promote social mobility beyond economic means, including education, intellect, style of speech, dress, or physical appearance.

Genetic Inheritance

The process by which biological traits and characteristics are passed on from parents to their offspring through their genes.