If a project costs $2000 up front and generates revenues of $500 per year for ten years,then any profit maximizing company will choose to undertake the project.

Question

Quizplus · Accepted Answer

The decision to undertake the project depends on the discount rate or the cost of capital. Without considering the time value of money, it's not possible to determine if the project's net present value (NPV) is positive, which is a key factor in profit-maximizing decisions.

If a Project Costs $2000 Up Front and Generates Revenues