If an Investment's Net Present Value Is Positive, Then

question 25

Multiple Choice

If an investment's net present value is positive, then:

• A) The investment provides a return greater than the discount rate.
• B) The investment provides a return less than the discount rate.
• C) The present value of the cash outflows must have been greater than the present value of the cash inflows.
• D) The investment should be deemed as unacceptable.

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Definitions:

Equilibrium Price

Equilibrium Price is the market price at which the quantity of goods supplied is equal to the quantity of goods demanded.

Deductible

The dollar sum of (for example, health care) costs that an insured individual must pay before the insurer begins to pay.

Elective Surgical Procedure

A surgery that is planned in advance and is not essential to save life or limb but may enhance the quality of life or physical appearance.

Equilibrium Price

The price at which the quantity of a good or service demanded by consumers matches the quantity supplied by producers, leading to a balance in the market.