ZuoTi.Pro
Question

The decision rule for net present value declares that a project is acceptable if

The decision rule for net present value declares that a project is acceptable if
business   finance   
0 0
Add a comment Improve this question Transcribed image text
Next > < Previous
Sort answers by oldest

Homework Answers

Answer #1

The correct answer is :

Net Present Value is positive.

Hence, The decision rule for net present value declares that a project is acceptable if its Net Present Value is positive.

This is because any project with a positive Net Present Value would be beneficial to the firm.

0 0
Add a comment
Know the answer?
Add Answer to:
The decision rule for net present value declares that a project is acceptable if
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

  • Understanding what the net present value (NPV) tells us. The NPV decision rule says to accept...

    Understanding what the net present value (NPV) tells us. The NPV decision rule says to accept the project if the NPV is greater than zero. You perform a thorough capital budgeting analysis on a project that requires a $1,000,000,000 initial investment and calculate the net present value (NPV) as $1. Following the rule, you tell your boss she should accept the project. She laughs and says “do you think I would really invest $1,000,000,000 for a measly $1 NPV? You...

  • 40. The decision rule for net present value is to: A) accept all projects with undiscounted...

    40. The decision rule for net present value is to: A) accept all projects with undiscounted cash inflows exceeding the initial cost. B) reject all projects with rates of return exceeding the opportunity cost of capital. C) accept all projects with positive net present values D) the decision to accept or reject a project is solely at management's discretion QUESTION 41 41. The decision rule for internal rate of return is to: A) accept all projects with negative NPVs. B)...

  • Evaluating cash flows with the NPV method The net present value (NPV) rule is considered one...

    Evaluating cash flows with the NPV method The net present value (NPV) rule is considered one of the most common and preferred criteria that generally lead to good investment decisions. Consider this case: Suppose Cute Camel Woodcraft Company is evaluating a proposed capital budgeting project (project Alpha) that will require an initial investment of $400,000. The project is expected to generate the following net cash flows: Year Cash Flow Year 1 $350,000 Year 2 $475,000 Year 3 $500,000 Year 4...

  • Evaluating cash flows with the NPV method The net present value (NPV) rule is considered one...

    Evaluating cash flows with the NPV method The net present value (NPV) rule is considered one of the most common and preferred criteria that generally lead to good investment decisions Consider this case: Suppose Hungry Whale Electronics is evaluating a proposed capital budgeting project (project Alpha) that will require an initial investment of $450,000. The project is expected to generate the following net cash flows: Year Cash Flow Year 1 $375,000 Year 2 $400,000 Year 3 $425,000 Year 4 $500,000...

  • 1. Net present value (NPV) Evaluating cash flows with the NPV method The net present value...

    1. Net present value (NPV) Evaluating cash flows with the NPV method The net present value (NPV) rule is considered one of the most common and preferred criteria that generally lead to good investment decisions. Consider this case: Suppose Cute Camel Woodcraft Company is evaluating a proposed capital budgeting project (project Alpha) that will require an initial investment of $600,000. The project is expected to generate the following net cash flows: Cash Flow Year Year 1 $300,000 $500,000 $425,000 $475,000...

  • Net present value Using a cost of capital of 14%, calculate the net present value for...

    Net present value Using a cost of capital of 14%, calculate the net present value for the project shown in the following table and indicate whether it is acceptable, E: The net present value (NPV) of the project is $ . (Round to the nearest cent.) Data Table - X Is the project acceptable? (Select the best answer below.) O O No Yes in order to copy the contents of the data table below (Click on the icon here into...

  • The net present value (NPV) rule is considered one of the most common and preferred criteria...

    The net present value (NPV) rule is considered one of the most common and preferred criteria that generally lead to good investment decisions. Consider this case: Suppose Celestial Crane Cosmetics is evaluating a proposed capital budgeting project (project Beta) that will require an initial investment of $3,225,000. The project is expected to generate the following net cash flows: Year Year 1 Year 2 Year 3 Year 4 Cash Flow $375,000 $475,000 $425,000 $500,000 Celestial Crane Cosmetics's weighted average cost of...

  • 1. Net present value (NPV) 1. Net present value (NPV) Aa Aa E Evaluating cash flows...

    1. Net present value (NPV) 1. Net present value (NPV) Aa Aa E Evaluating cash flows with the NPV method The net present value (NPV) rule is considered one of the most common and preferred criteria that generally lead to good investment decisions. Consider this case: Suppose Lumbering Ox Truckmakers is evaluating a proposed capital budgeting project (project Beta) that will require an initial investment of $2,225,000. The project is expected to generate the following net cash flows: Year Year...

  • The net present value (NPV) rule is considered one of the most common and preferred criteria...

    The net present value (NPV) rule is considered one of the most common and preferred criteria that generally lead to good investment decisions. Consider the case of Hungry Whale Electronics: Suppose Hungry Whale Electronics is evaluating a proposed capital budgeting project (project Alpha) that will require an initial investment of $400,000. The project is expected to generate the following net cash flows: Year Cash Flow Year 1 $300,000 Year 2 $425,000 Year 3 $475,000 Year 4 $425,000 The company’s weighted...

  • The net present value (NPV) rule is considered one of the most common and preferred criteria...

    The net present value (NPV) rule is considered one of the most common and preferred criteria that generally lead to good investment decisions. Consider this case: Suppose Happy Dog Soap Company is evaluating a proposed capital budgeting project (project Alpha) that will require an initial investment of $500,000. The project is expected to generate the following net cash flows: Year Cash Flow Year 1 $350,000 Year 2 $425,000 Year 3 $425,000 Year 4 $400,000 Happy Dog Soap Company’s weighted average...

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