The ____ an MNC's cost of capital, the ____ will be the net present value for a proposed project with a given set of expected cash flows.
A)lower; higher
B)higher; higher
C)lower; lower
D)none of the above

Question

Quizplus · Accepted Answer

A lower cost of capital means that the MNC can secure funding at a lower rate, which in turn means that the net present value of a proposed project will be higher as the cost of borrowing is lower. Conversely, a higher cost of capital will result in a lower net present value for the proposed project.

The ____ an MNC's Cost of Capital, the ____ Will

The an MNC's Cost of Capital, the Will