Normal Projects S and L have the same NPV when the discount rate is zero. However, Project S's cash flows come in faster than those of L. Therefore, we know that at any discount rate greater than zero, L will have the higher NPV.

Answer the following statement true (T) or false (F)


False

Rationale:

We can see from the graph that S has the higher NPV if r > 0.

Business

You might also like to view...

Free Standing Inserts (FSI) are found primarily in:

A) magazines B) newspapers C) shopping malls D) catalogs

Business

Paper-based press kits have been completely replaced by electronic press kits because of industrial globalization and the costs and time associated with printing and delivering paper formats

Indicate whether the statement is true or false

Business

A stock split can involve issuing more shares of stock than authorized in the corporate charter

Indicate whether the statement is true or false

Business

Price reduction is not available as a buyer's remedy for the seller's breach under the CISG if: A) the seller has already delivered conforming substitute goods

B) the buyer has refused to accept the seller's attempt to cure the breach. C) the buyer has avoided the contract and refused delivery. D) all of the above.

Business