Which of the Following Best Describes the Net Present Value

question 67

Multiple Choice

Which of the following best describes the Net Present Value rule?

• A) Take any investment opportunity where the net present value (NPV) is not negative; turn down any opportunity when it is negative.
• B) Take any investment opportunity where the net present value (NPV) exceeds the opportunity cost of capital; turn down any opportunity where the cost of capital exceeds the net present value (NPV).
• C) When choosing among any list of investment opportunities where resources are limited, always choose those projects with the highest net present value (NPV).
• D) If the difference between the present cost of an investment and the present value (PV) of its benefits after a fixed number of years is positive the investment should be taken, otherwise it should be rejected.

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Definitions:

Very-Low-Birthweight Infants

Infants who weigh less than 1,250 grams (around 2.25 pounds) or, regardless of weight, have been in the womb less than 30 weeks.

Prematurity

The condition of a baby being born before the completion of the normal term of pregnancy, typically before 37 weeks of gestation.

Small-For-Gestational-Age

Refers to infants whose birth weight or length is significantly below the norm for their gestational age, often due to genetic factors or issues during pregnancy.

Chromosomal Damage

Structural changes or breaks in chromosomes, which can lead to genetic disorders or diseases.