Which of the Following Statements Is False

question 45

Multiple Choice

Which of the following statements is false?

• A)Accepting a project with an internal rate of return greater than the required rate of return should result in an increase in a firm's share price.
• B)Accepting a project with an internal rate of return greater than the required rate of return should result in a positive net present value.
• C)Accepting a project with an internal rate of return less than the required rate of return should result in a negative net present value.
• D)Accepting a project with an internal rate of return equal to the required rate of return should result in an increase in a firm's share price.

---

Definitions:

Cash Dividends

Payments made by a company from its earnings to its shareholders in the form of cash.

Retained Earnings

Cumulative net earnings or profit of a firm after accounting for dividends; they are reinvested in the core business or to pay debt.

Net Income

The net income of a company once all costs and taxes are deducted from the overall revenue.

Fixed Assets

Long-term tangible assets used in operations, such as machinery, buildings, and equipment, which are not expected to be converted into cash in the short term.