An international project's NPV is _________ related to the size of the initial investment and _________ related to the project's required rate of return.

Question

Quizplus · Accepted Answer

The NPV (Net Present Value) is negatively related to the size of the initial investment because a larger initial outlay reduces the NPV. It is also negatively related to the project's required rate of return because a higher discount rate reduces the present value of future cash flows, thus reducing the NPV.

An International Project's NPV Is _________ Related to the Size