If the Net Present Value of a Project Is Positive

question 45

Multiple Choice

If the net present value of a project is positive then the:

• A)project would be unacceptable under the internal rate of return method.
• B)project would be acceptable under the payback method.
• C)project's rate of return is greater than the firm's cost of capital.
• D)All of the above are correct.

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Definitions:

Previous Year

The 12-month period immediately before the current year, used as a reference point for comparing data or statistical analysis.

Unemployment

The situation where individuals who are willing and able to work are not currently employed.

Inflation

The magnitude of growth in the overall price points for goods and services, weakening the efficacy of spending power.

Government Spending

The total amount of money expended by a government on various sectors, including infrastructure, education, defense, and social services.