The Discount Rate That Yields a Net Present Value of Zero

question 165

Multiple Choice

The discount rate that yields a net present value of zero for an investment is the:

• A) Net present value rate of return.
• B) Zero rate of return.
• C) Internal rate of return.
• D) Payback rate of return.
• E) Accounting rate of return.

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Definitions:

Confirmation Error

A cognitive bias that involves focusing on information that confirms one's preconceptions and ignoring information that contradicts them.

Framing Error

A mistake made when individuals misinterpret the context or perspective of a decision or problem, often influenced by the way information is presented.

Strategic Opportunism

A business strategy focusing on recognizing and capitalizing on opportunities with flexibility while maintaining a core strategic direction.

Lack-of-participation Error

A mistake or bias that occurs due to the absence or minimal involvement of certain groups or individuals.