Question: It is sometimes argued that the NPV criterion is appropriate for corporations but not for governments. First, governments must consider the time preferences of the

It is sometimes argued that the NPV criterion is appropriate for corporations but not for governments. First, governments must consider the time preferences of the community as a whole rather than those of a few wealthy investors. Second, governments must have a longer horizon than individuals, for governments are the guardians of future generations. What do you think?

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The two points raised in the question do not invalidate the NPV rule a As long as capital markets do ... View full answer

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