Which of the Following Is a Reason That Makes NPV

question 114

Multiple Choice

Which of the following is a reason that makes NPV a better approach to capital budgeting on a purely theoretical basis?

• A) It measures the benefits relative to the relative amount invested.
• B) The reinvestment rate assumed by this method is reasonable.
• C) Financial decision makers are inclined to higher rates of return.
• D) Interest rates are expressed as annual rates of return.

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Definitions:

Edict Of Nantes

A 1598 decree issued by King Henry IV of France, granting substantial religious freedoms to French Protestants (Huguenots) and bringing an end to the Wars of Religion.

Huguenots

Members of the French Protestant group that faced severe persecution in the 16th and 17th centuries, leading many to flee France for other countries.

New France

The area colonized by France in North America from the 16th to the 18th century, including parts of contemporary Canada, the United States, and several Caribbean islands.

Catastrophic Decline

A severe and rapid decrease in the population, quality, or condition of something, often leading to its dire depletion or degradation.