When the present value of the cash inflows exceeds the initial cost of a project, then the project should be:
A. accepted because the internal rate of return is positive.
B. accepted because the profitability index is greater than 1.
C. accepted because the profitability index is negative.
D. rejected because the internal rate of return is negative.
E. rejected because the net present value is negative.
Answer: B. accepted because the profitability index is greater than 1.
You might also like to view...
Television offers advertisers the most extensive coverage and highest reach of any media
Indicate whether the statement is true or false
What is meant by the term clean surplus accounting?
What factor is likely to influence our own social categorization and attitudes toward others?
a. our heritage and family history *b. our own group identification c. the region of the world we grew up in d. our social economic status
Explain the Japanese saying "A nail standing out will be hammered down." Discuss how the Japanese feel about group-oriented behavior versus emphasis on the individual