If the Net Present Value of a Project That Costs

question 28

Multiple Choice

If the net present value of a project that costs $20,000 is $5,000 when the discount rate is 10%,then the:

• A) project's IRR equals 10%.
• B) project's rate of return is greater than 10%.
• C) net present value of the cash inflows is $4,500.
• D) project's cash inflows total $25,000.

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Definitions:

Problem-solving

The process of identifying a challenge or issue, analyzing the problem, and developing strategies to address it effectively.

Utilizing

The act of making use of resources or skills effectively for a specific purpose.

Implications

The possible effects or consequences of an action or decision, often extending beyond the immediate outcomes.

Truant

Refers to a student who stays away from school without permission or explanation, often leading to legal and educational consequences.