Which of the Following Statements Is FALSE

question 60

Multiple Choice

Which of the following statements is FALSE?

• A)It is possible that an IRR does not exist for an investment opportunity.
• B)If the payback period is less than a pre-specified length of time,you accept the project.
• C)The internal rate of return (IRR)investment rule is based upon the notion that if the return on other alternatives is greater than the return on the investment opportunity,you should undertake the investment opportunity.
• D)It is possible that there is no discount rate that will set the NPV equal to zero.

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Definitions:

Demand Schedule

A Demand Schedule is a tabular representation of the relationship between the price of a good or service and the quantity demanded by consumers, underlining the law of demand.

Patents

Legal documents granting an inventor exclusive rights to produce, use, and sell an invention for a certain number of years.

Research And Development

A business or government activity that involves the study and creation of new products, services, or discoveries.

LRAC Curve

Long-Run Average Cost Curve, showing the lowest average cost at which a firm can produce any given level of output in the long term.