alleryStart learning →A project with a positive net present value should be:
ADuplicated
BAccepted
CCancelled
DPostponed
Answer & Solution
Correct answer: B. Accepted
1. Net present value measures the value a project creates.
2. A positive figure means the project adds value.
3. Projects with a positive NPV should be accepted.
4. So the decision is to accept.
_Source: OpenStax Principles of Finance (CC BY 4.0), Ch 16 'How Companies Think about Investing', sections 16.1-16.5_
Keep practising Capital Budgeting
Browse all Capital Budgeting questions for US CMA Part 2, or explore more Finance topics.
Related questions
Find the crossover rateWhich figure is higherSpot the false ruleLeave the strength standingAccept it or reject itThe discounted payback period improves on plain payback by first doing what to the cash flA machine costs $16,000 and the added cash inflow recovers that cost over four years. PaybThe NPV method and the profitability index method will always agree on: