When the Present Value of Expected Cash Inflows from a Project

question 126

Multiple Choice

When the present value of expected cash inflows from a project equals the present value of expected cash outflows of a project, the discount rate is the

• A)universal rate.
• B)internal rate of return.
• C)required rate.
• D)net present value rate.
• E)inflation rate.

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Definitions:

Goodwill

The intangible asset that arises when a business is acquired for more than the fair value of its net identifiable assets.

Long-Lived Assets

Tangible or intangible assets that provide economic benefits to a business over several years, including property, plant, and equipment.

Machinery And Equipment

Heavy tools and instruments used in various industries for manufacturing, processing, or handling of products.

Long-Lived Assets

Assets that provide economic benefit to a business for more than one fiscal year, such as buildings, machinery, and land.