Assume a project is independent with financing cash flows. Which one of these statements is correct?
A) The IRR cannot be used to determine the acceptability of the project.
B) The project is acceptable if the required return exceeds the IRR.
C) The project is acceptable only if the NPV is zero or negative.
D) The project's required rate of return will always be negative.
E) The project is acceptable if the internal rate of return is negative.

Question

Assume a project is independent with financing cash flows. Which one of these statements is correct? 
A) The IRR cannot be used to determine the acceptability of the project. 
B) The project is acceptable if the required return exceeds the IRR. 
C) The project is acceptable only if the NPV is zero or negative. 
D) The project's required rate of return will always be negative. 
E) The project is acceptable if the internal rate of return is negative.

Quizplus · Accepted Answer

The project is acceptable if the required return exceeds the IRR.

Assume a Project Is Independent with Financing Cash Flows