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5. NPV profiles An NPV profile plots a projects NPV at various costs of capital, labeled A and B in the graph. A project

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Answer #1

Area A (or Green area) shows area with positive NPV. So, you should ACCEPT the project in that area.

Area B (or Purple area) shows area with negative NPV. So, you should REJECT the project in that area.

The NPV and IRR methods can lead to conflicting decisions for mutually exclusive projects - TRUE

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Answer #2

This NPV profile demonstrates that as the cost of capital increases, the project’s NPVdecreases   

source: FB 351 MindTap
answered by: hlgrant1102
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