When the Present Value of the Cash Inflows Exceeds the Initial

question 60

Multiple Choice

When the present value of the cash inflows exceeds the initial cost of a project,then the project should be:

• A)accepted because the internal rate of return is positive.
• B)accepted because the profitability index is greater than 1.
• C)accepted because the profitability index is negative.
• D)rejected because the internal rate of return is negative.
• E)rejected because the net present value is negative.

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