Which of the following statements regarding NPV analysis is true?
A) The timing of incremental revenues and costs is irrelevant in NPV analysis
B) Uncertainties increase as the dollar value of an investment increases
C) The discount rate can be calculated with certainty if it is based on the weighted average cost of capital
D) Managers should generally accept projects with an NPV greater than zero

Question

Quizplus · Accepted Answer

NPV (Net Present Value) analysis considers the timing of cash flows as crucial, and a positive NPV indicates that the project's returns exceed its costs, adjusted for the time value of money, making it a worthwhile investment.

Which of the Following Statements Regarding NPV Analysis Is True