Projects with a negative net present value will always have a(n)

Question

Quizplus · Accepted Answer

None of the answer choices are correct. The net present value of a project represents the difference between the present value of its expected future cash flows and the initial investment. If the net present value is negative, the project is not expected to generate sufficient cash flows to cover the initial investment and provide a return that exceeds the cost of capital. Therefore, it is not possible for a project with a negative net present value to have a payback period shorter than the life of the project, an accounting rate of return greater than zero, or an internal rate of return greater than the cost of capital.

Projects with a Negative Net Present Value Will Always Have