Net Present Value (NPV) Is the Difference Between the Present

question 89

True/False

Net present value (NPV) is the difference between the present value (PV) of the benefits and the present value (PV) of the costs of a project or investment.

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Definitions:

Depreciation

Depreciation is the accounting process of allocating the cost of tangible assets over their useful lives, reflecting the loss of value as the asset is used.

Capitalized

The process of recording a cost or expense as an asset on the balance sheet, rather than immediately expensing it, typically to spread the cost over its useful life.

Double-Declining-Balance Method

An accelerated depreciation method that doubles the normal depreciation rate, reducing the carrying value of an asset more quickly.