An Investment Project for Which the Net Present Value Is

question 12

Multiple Choice

An investment project for which the net present value is $300 would result in which of the following conclusions?

• A)The net present value is too small;the project should be rejected.
• B)The rate of return of the investment project is greater than the required rate of return.
• C)The net present value method is not suitable for evaluating this project;the internal rate of return method should be used.
• D)The investment project should only be accepted if net present value is zero;a positive net present value indicates an error in the estimates associated with the analysis of this investment.

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Definitions:

Delivered

In a behavioral context, refers to the administration or provision of a consequence or reinforcement following a behavior.

Positive Reinforcement

A process in behavioral psychology whereby a behavior is strengthened by the consequence of experiencing a positive condition.

Stimuli

External or internal cues that evoke a response from an organism or system.

Probability

A measure of the likelihood that a specific event will occur, expressed as a number between 0 and 1, where 0 indicates impossibility and 1 indicates certainty.