When using the net present value method,if the net present value of a project is negative,then the ________.
A) the project should be rejected
B) the project should be accepted
C) the project should be recalculated for missing cash inflows
D) none of the above

Question

Quizplus · Accepted Answer

A negative net present value implies that the project's expected cash outflows exceed the present value of its expected cash inflows. This means that the project is not expected to generate enough profits to cover its costs and provide a return on investment that meets the required rate of return. Therefore, the best decision is to reject the project.

When Using the Net Present Value Method,if the Net Present