At a 13% Cost of Capital,a Project's NPV Is $100,000

question 68

Multiple Choice

At a 13% cost of capital,a project's NPV is $100,000 if you invest today.By what amount must the initial cost of the project decrease before you would wish to wait 2 years before investing? Assume all else is held constant.

• A) $21,685
• B) $26,000
• C) $27,690
• D) $29,380

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Definitions:

Simple Interest

Interest calculated only on the principal amount, or the initial sum of money invested or borrowed, without compounding.

Convert Communicator

This term refers to an individual who adopts new beliefs or practices and then acts to persuade others to adopt these new beliefs or practices as well.

Previously Held Attitudes

Beliefs or opinions that an individual had before being exposed to new information or experiences.

Arguing Against

The process of presenting reasons or evidence to counter or dispute a particular claim, opinion, or proposition.