Which of the Following Statements Is CORRECT? Assume That All

question 32

Multiple Choice

Which of the following statements is CORRECT? Assume that all projects being considered have normal cash flows and are equally risky.

• A) If a project's IRR is equal to its WACC,then,under all reasonable conditions,the project's NPV must be negative.
• B) If a project's IRR is equal to its WACC,then under all reasonable conditions,the project's IRR must be negative.
• C) If a project's IRR is equal to its WACC,then under all reasonable conditions the project's NPV must be zero.
• D) There is no necessary relationship between a project's IRR,its WACC,and its NPV.
• E) When evaluating mutually exclusive projects,those projects with relatively long lives will tend to have relatively high NPVs when the cost of capital is relatively high.

---

Definitions:

Eye Contact

The act of two individuals looking directly into each other's eyes, often used as a form of nonverbal communication.

Résumé

A document prepared by job applicants summarizing their work experience, education, and skills to showcase their qualifications for a job.

Unemployment

A situation when a person who is actively searching for employment is unable to find work.

Interview

A formal meeting where one or more persons question, consult, or evaluate another person.