How Do You Apply the Net Present Value Rule When

question 57

Essay

How do you apply the Net Present Value rule when multiple projects are available and you have the added constraint of accepting only one project?

---

Definitions:

Annual Dividends

The total amount of dividend payments declared by a corporation in one fiscal year, distributed to shareholders on an annual basis.

Dividend Increase

A company's action to raise the amount of money paid to shareholders out of its profits on a per-share basis.

Required Return

The minimal yearly percentage increase essential to entice investment by individuals or companies into a certain project or security.

Per Share Dividend

The amount of dividend that is paid out for each share of a company's stock.