Question

Which of the following is not a rationale for using the NPV method in capital budgeting?

a. An NPV of zero signifies that the project's cash flows are just sufficient to repay the invested capital and to provide the required rate of return on that capital.

b. A project whose NPV is positive will increase the value of the firm if that project is accepted.

c. A project is considered acceptable if it has a positive NPV.

d. A project is not considered acceptable if it has a negative NPV.

e. All of the above are true.

Answer

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