Which of the Following Statements Is CORRECT

question 12

Multiple Choice

Which of the following statements is CORRECT?

• A) An NPV profile graph shows how a project's payback varies as the cost of capital changes.
• B) The NPV profile graph for a normal project will generally have a positive (upward)slope as the life of the project increases.
• C) An NPV profile graph is designed to give decision makers an idea about how a project's risk varies with its life.
• D) An NPV profile graph is designed to give decision makers an idea about how a project's contribution to the firm's value varies with the cost of capital.
• E) We cannot draw a project's NPV profile unless we know the appropriate WACC for use in evaluating the project's NPV.

---

Definitions:

Barrier Method

A type of contraception that physically blocks sperm from entering the uterus, examples include condoms and diaphragms.

Female Condom

A barrier contraceptive device worn inside the vagina to prevent sperm from reaching an egg and protect against sexually transmitted infections.

Support Products

Items or services that supplement the main products or services of a company, enhancing the value of their primary offerings.

Automated Assembly Lines

Production systems where equipment and machinery are used to automatically assemble products with minimal human intervention.