Which of the Following Statements Is Correct? Assume That the Project

question 55

Multiple Choice

Which of the following statements is correct? Assume that the project being considered has normal cash flows,with one outflow followed by a series of inflows.

• A)If Project A has a higher IRR than Project B, then Project A must have the lower NPV.
• B)If Project A has a higher IRR than Project B, then Project A must also have a higher NPV.
• C)The IRR calculation implicitly assumes that all cash flows are reinvested at the WACC.
• D)If a project has normal cash flows and its IRR exceeds its WACC, then the project's NPV must be positive.

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Definitions:

Reported Malaria Cases

The number of malaria infections that have been diagnosed and documented by health authorities.

West Africa

A region in Africa that is to the west of the continent, comprising several countries including Nigeria, Ghana, and Senegal.

Categorical Variables

Variables that represent categories and can take on one of a limited and usually fixed number of possible values.

Quantitative Variable

A variable that can be counted or measured and expressed numerically.