Question: When a projects Net Present Value exceeds zero, The project is valuable and can be sold. The project will have a rate of return less

When a projects Net Present Value exceeds zero,

The project is valuable and can be sold.

The project will have a rate of return less than the required return.

The present value of all inflows is greater than the present value of all outflows or costs.

The project will return the firms investment in just a few years.

Step by Step Solution

There are 3 Steps involved in it

1 Expert Approved Answer
Step: 1 Unlock blur-text-image
Question Has Been Solved by an Expert!

Get step-by-step solutions from verified subject matter experts

Step: 2 Unlock
Step: 3 Unlock

Students Have Also Explored These Related Finance Questions!

Q:

1.A project cost $1,000 and will result in cash flows of 71 per year for four years. In addition the project will return $1000 to the investor at the end of the fourth year. The projects cost of...

Q:

When a projects Net Present Value exceeds zero, the project will also be acceptable using payback criteria. the IRR should be calculated to ensure that the project's projected rate of return exceeds...

Q:

The Gopher Co. is debating over which one of two projects they should accept. The initial investment is the same for both projects. Project A will produce annual cash flows of $38,000 a year for six...

Q:

When a projects Net Present Value exceeds zero, a. The project will also be acceptable using payback criteria. b. The IRR should be calculated to insure that the projects projected rate of return...

Q:

10 (3 points) A firm's stock is expected to pay a $2 annual dividend next year, and the current $50 stock price is expected to rise to $53 over the next year. What is the expected return? Question 10...

Q:

Farms has common stock of $101, paid-in-capital of $358, total liabilities of $455, current assets of $480 and net fixed assets of $690. What is the amount of shareholders' equity? $575 $1170 $715...

Q:

Time left 0:25:19 company's required rate of return is 10% and, in using the present worth method, a project's net present value is zero, this indicates that the on O a. project earns a rate of...

Q:

1. Lanyard Company is considering an investment that will generate $600,000 in cash inflows per year for 7 years and has $240,000 of cash outflows for the same period (before income taxes). The cost...

Q:

2. Inglewood Inc. would like to purchase a specialized production machine for $3,500,000. The machine is expected to have a life of three years, and a salvage value of $200,000. Annual mainte-nance...

Q:

Question 5 20 pts Which of the following statements is correct? A project has a positive payback period. This means the project should be accepted A project's net present value exceeds its internal...

Q:

if correct will give a like please help. Directions: Read the passage and then answer the questions D. B. Cooper: Legendary Skyjacker By Franz Korn (1) D. B. Cooper is the name given to an...

Q:

21. Bill and Beth are both 56 years old and file a joint return. Bill is covered by a retirement plan at work, but Beth is not covered by a plan at work. Bill's salary was $60,000. Beth's salary was...

Q:

Examplify hanemtomito Drosess Week a txam 3 - PADL INA NAVA ( D 4 1 3 1 2 3 0 4 ) TIMAL RHEMANEHELS 0 0 / A 1 EXAMA COATHELS Question 3 1 are antimicrobial proteins released by virally infected cells...

Q:

A company is preparing completing their Cash Budget. The following data has been prepared for cash receipts and payments. January February March Cash receipts $1,061,200 $1,182,400 $1,091,700 Cash...