Question: (TRUE/FALSE). If you disagree, correct the statement or explain briefly why you disagree a) Reject ANY project with an NPV of zero, as your company
(TRUE/FALSE). If you disagree, correct the statement or explain briefly why you disagree
a) Reject ANY project with an NPV of zero, as your company is not going to earn any return on such investments.
b) Accept those projects with a positive NPV, as accepting them is equivalent to receiving their NPV in cash immediately
c) When estimating cost of capital of a 100% equity-financed project if comparable firm is levered, we use rate of return on equity of the comparable firm as the estimate of the cost of capital for the project.
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