According to the net present value rule, an investment in a project should be made if the:
A) Net present value is greater than the cost of investment
B) Net present value is greater than the present value of cash flows
C) Net present value is positive
D) Net present value is negative

Question

Quizplus · Accepted Answer

The net present value rule states that an investment in a project should be made if the net present value is positive. A positive net present value indicates that the investment will generate more cash flow than the cost of the investment, taking into account the time value of money. Therefore, option C is the correct answer.

According to the Net Present Value Rule, an Investment in a Project