Which of the Following Statements Regarding the NPV Decision Rule

question 65

Multiple Choice

Which of the following statements regarding the NPV decision rule is false?

• A) Reject projects with an NPV of zero, as accepting them is equivalent to losing the present value of the projects' costs.
• B) When faced with a set of alternatives, choose the one with the highest NPV.
• C) Accept those projects with a positive NPV, as accepting them is equivalent to receiving their NPV in cash today.
• D) Reject those projects with a negative NPV, as not doing them has NPV = 0.

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Definitions:

Park Range

A setting in automatic transmissions that locks the transmission, preventing the vehicle from moving.

Inductive Pick-up Clamp

a tool used to measure electrical parameters in a conductor without direct contact, commonly used in automotive diagnostics.

Starter Cable

An electrical cable that connects a vehicle's battery to its starter motor, facilitating the transfer of electrical power needed for engine cranking.

Conventional Current Flow

Theoretical flow of electrical current from the positive to the negative pole, opposite to the actual flow of electrons.