Which of the Following Statements Is FALSE

question 34

Multiple Choice

Which of the following statements is FALSE?

• A) In general, the difference between the cost of capital and the internal rate of return (IRR) is the maximum amount of estimation error in the cost of capital estimate that can exist without altering the original decision.
• B) The internal rate of return (IRR) can provide information on how sensitive your analysis is to errors in the estimate of your cost of capital.
• C) If you are unsure of your cost of capital estimate, it is important to determine how sensitive your analysis is to errors in this estimate.
• D) If the cost of capital estimate is more than the internal rate of return (IRR), the net present value (NPV) will be positive.

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Definitions:

Stakeholder Responsibility

Involves the obligations and duties that an organization has towards its stakeholders, including customers, employees, investors, and the wider community, to act ethically and contribute to well-being.

Profit Responsibility

The obligation or duty of a company to maximize profits for its shareholders or owners, while maintaining ethical practices.

Mass Marketing

A marketing strategy that aims to reach a wide audience through broad communication channels and generic messages.

Corn-Based Resins

Bioplastic materials derived from corn starch, used as an environmentally friendly alternative to petroleum-based plastics for various applications.