Using an Excel Spreadsheet to Calculate Net Present Value (NPV)has

question 75

Multiple Choice

Using an Excel spreadsheet to calculate net present value (NPV) has an advantage over using a financial calculator because

• A) the spreadsheet retains the full precision of all non-rounded numbers while the calculator will cumulate rounding errors.
• B) not all financial calculators compute NPV using the same parameters.
• C) financial calculators cannot differentiate between payments made immediately or payments deferred by one period.
• D) financial calculators cannot solve when the unknown is other than NPV (e.g.: NPV given, solve for the interest rate).