Which of the Following Statements About the Net Present Value

question 11

Multiple Choice

Which of the following statements about the net present value method of selecting projects is true?

• A)If projects are independent,then the project with the highest net present value (providing it is greater than zero)is accepted.
• B)If the projects are mutually exclusive,then all projects with a net present value greater than zero are accepted.
• C)For two mutually exclusive projects,the net present value and internal rate of return methods select different projects if the required rate of return is greater than the discount rate at which the two net present value profiles intersect.
• D)If a project's cash flows are positive after discounting them by the required rate of return,then it may be accepted if there are no better alternatives.

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Definitions:

Promotions

A process in which an employee is moved to a higher position within the company, typically involving increased responsibilities and pay.

Reliable

Pertaining to the consistency and dependability of something or someone, particularly in performing functions or yielding results.

Consistent

indicates uniformity in actions or outcomes over a period of time, often used to describe reliability and predictability in performance or results.

Criterion Contamination

This occurs when a performance appraisal contains factors unrelated to actual job performance, potentially skewing the evaluation.