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    Question

    For project appraisal, Net Present Value (NPV) of a

    project is positive. That implies:
    A The project is unacceptable Correct Answer Incorrect Answer
    B The project yields exactly required rate of return Correct Answer Incorrect Answer
    C The project increases firm value and is acceptable Correct Answer Incorrect Answer
    D The project has negative internal rate of return Correct Answer Incorrect Answer
    E None of the above Correct Answer Incorrect Answer

    Solution

    Positive NPV means present value of cash inflows > outflows at required rate of return; accept.

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