ZuoTi.Pro
Question

Question 3 5 pts Which of the following statements about the net present value is true? It has an inadequate reinvestment ass

business   finance   
0 0
Add a comment Improve this question Transcribed image text
Next > < Previous
Sort answers by oldest

Homework Answers

Answer #1

True: It deals with free cash flows rather than accounting profits

Net present value is a difference of present value future free cash inflows and present value of cash outflows.

Hope this will help, please do comment if you need any further explanation. Your feedback would be highly appreciated.

0 0
Add a comment
Know the answer?
Add Answer to:
Question 3 5 pts Which of the following statements about the net present value is true?...
Your Answer:

Post as a guest

Your Name:

What's your source?

Earn Coins

Coins can be redeemed for fabulous gifts.

Log In

Sign Up

Not the answer you're looking for? Ask your own homework help question. Our experts will answer your question WITHIN MINUTES for Free.
Similar Homework Help Questions

  • 3. Which one of the following statements is TRUE about a project's net present value? A....

    3. Which one of the following statements is TRUE about a project's net present value? A. When choosing between projects, a company should take on the project with the lowest net present value B. When deciding to accept or reject a project, a company should reject the project if its net present value is positive C. A project's net present value provides the payback period of an investment B. When deciding to accept or reject a project, the project's net...

  • Which ofthe following statements is true regarding net present value? A. NPV decreases as the required...

    Which ofthe following statements is true regarding net present value? A. NPV decreases as the required return on the project increases B. NPV decreases as the discount rate decreases C. NPV is unaffected by the timing of the project’s cash flows. D. NPV is equal to the initial investment when the required return is equal to the IRR

  • Which of the following statements are correct about the decision rules for net present value (NPV)...

    Which of the following statements are correct about the decision rules for net present value (NPV) and Profitability Index (PT) A) They always result in the same decision O B) They may result in different decisions C) NPV is always greater than PH D) a and E) b and

  • Which of the following statements are correct about the decision rules for net present value (NPV)...

    Which of the following statements are correct about the decision rules for net present value (NPV) and Profitability Index (PT) A) They always result in the same decision O B) They may result in different decisions C) NPV is always greater than PH D) a and E) b and

  • Which of the following statements is true? A given present value will result in a higher...

    Which of the following statements is true? A given present value will result in a higher future value if annual compounding is used rather than monthly compounding, Effective Annual Rate is greater than Annual Percentage Rate when annual compounding is used. ОО A perpetuity with the cash flow starting two years from now will have the same present value as a perpetuity with the same cash flow starting a year from now. A group of cash flows of the same...

  • Which of the following is (are) true? a) If the net present value (NPV) is negative,...

    Question 1Which of the following is (are) true? a) If the net present value (NPV) is negative, then the profitability index must be less than zero. b) If the IRR of a project is greater than one (1), then the project should be accepted. c) Under capital rationing conditions, a firm can select all acceptable projects regardless of the initial investment required. d) If two projects are mutually exclusive, selecting one project prohibits the acceptance of the other project. e) None of the above statements...

  • Question 161 pts Which of the following statements about the influences on self-disclosure is TRUE? In...

    Question 161 pts Which of the following statements about the influences on self-disclosure is TRUE? In initial encounters, women tend to self-disclose more intimately than men. Highly sociable people disclose less. Americans, in general, self-disclose more than people in Japan and Germany. You are more likely to self-disclose unfavorable than favorable information.

  • 1. Which of the following statements is true about independent projects? a.Independent projects are projects that, if ac...

    1. Which of the following statements is true about independent projects? a.Independent projects are projects that, if accepted, have to accept one small project to assist other independent projects. b.Independent projects are projects that, if accepted or rejected, do not affect the cash flows of other projects. c.Independent projects are projects that, if accepted, have a negative effect on the company's profit. d.Independent projects are projects that, if accepted or rejected, affect the net profit of other projects. 2. An...

  • my question is Q1, payback periods ans net present value, thank you! Chapter 9 Net Present...

    my question is Q1, payback periods ans net present value, thank you! Chapter 9 Net Present Value and Other investment Criteria 9.3 Here we need to are we need to calculate the ratio of average net income to average book value to get the AAR. Average net income is: Average net income = ($2.000 + 4,000 + 6,000)/3 $4.000 Average book value is: Average book value = $12,000/2 = $6,000 So the average accounting return is: AAR = $4,000/6,000 =...

  • Which one of the following statements is correct? a) The net present value is a measure...

    Which one of the following statements is correct? a) The net present value is a measure of profits expressed in today's dollars. b) The net present value is positive when the required return exceeds the internal rate of return. c) If the initial cost of a project is increased, the net present value of that project will also increase. d) Net present value is equal to an investment's cash inflows discounted to today's dollars.

ADVERTISEMENT
Free Homework Help App
Download From Google Play
Scan Your Homework
to Get Instant Free Answers
Need Online Homework Help?
Ask a Question
Get Answers For Free
Most questions answered within 3 hours.
ADVERTISEMENT
ADVERTISEMENT
ADVERTISEMENT