Examlex

Solved

The Net Present Value Method of Evaluating Capital Investments Suggests

question 92

True/False

The net present value method of evaluating capital investments suggests that an investment with discounted net cash inflows which exceed the initial cost of the investment is desirable.


Definitions:

Dividends

Payments made by a corporation to its shareholders, usually as a distribution of profits.

Common Stock

A type of equity ownership in a corporation, representing a claim on part of the company's profits and assets.

Price-Earnings Ratio

A valuation ratio of a company's current share price compared to its per-share earnings, indicating the dollar amount investors will pay for $1 of earnings.

Market Price

The existing cost for buying or selling an asset or service.

Related Questions