In Using the Net Present Value Method, Only Projects with a Zero

question 22

Multiple Choice

In using the net present value method, only projects with a zero or positive net present value are acceptable because:

• A)the return from these projects equals or exceeds the cost of capital
• B)a positive net present value on a particular project guarantees company profitability
• C)the company will be able to pay the necessary payments on any loans secured to finance the project
• D)Both A and B are correct.

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Definitions:

Phenylketonuria

A genetic disorder resulting in an inability to metabolize the amino acid phenylalanine, requiring a strict diet to prevent intellectual disability and other health problems.

PKU

Phenylketonuria, a rare inherited disorder that increases the levels of a substance called phenylalanine in the blood, requiring dietary management.

Normalization Principle

A principle advocating that people with disabilities should have living conditions akin to those of the rest of society.

FASD

Fetal Alcohol Spectrum Disorders; a group of conditions that can occur in a person whose mother drank alcohol during pregnancy.