Which Statement About an NPV Profile Graph Is True

question 44

Multiple Choice

Which statement about an NPV profile graph is true?

• A)An NPV profile graph shows how a project's payback varies as the cost of capital changes.
• B)The NPV profile graph for a normal project will generally have a positive (upward) slope as the life of the project increases.
• C)An NPV profile graph is designed to give decision makers an idea about how a project's risk varies with its life.
• D)An NPV profile graph is designed to give decision makers an idea about how a project's contribution to the firm's value varies with the cost of capital.

---

Definitions:

United States

A country located in North America, comprising 50 states, a federal district, five major self-governing territories, and various possessions.

Involuntarily Committed

This refers to a legal process through which individuals with severe mental health issues are hospitalized or treated without their consent due to potential harm to themselves or others.

Mental Hospital

A healthcare facility specializing in the treatment and care of patients with mental illnesses.

Psychoanalysis

A method of therapy and theory of personality developed by Sigmund Freud that emphasizes unconscious motives and conflicts.