The Decision Rule for Net Present Value Declares That a Project

question 37

Multiple Choice

The decision rule for net present value declares that a project is acceptable if:

• A)it pays back within a specified time period.
• B)the rate of return is greater than the firm's cost of capital.
• C)the present value of the cash inflows exceeds the initial cash outflow.
• D)all of the statements above are true.

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Definitions:

Centralized Facility

describes a single location where operations or decision-making processes are concentrated, often to leverage efficiency or control.

Distribution Centre

A specialized facility that is responsible for receiving, storing, and distributing products to retailers or customers.

Labour Cost

The expense associated with the work performed by employees, encompassing salaries, wages, and additional benefits.

Productivity

The ratio of outputs (goods and services) divided by one or more inputs (such as labour, capital, or management).