An investment opportunity costing $750,000 has a net present value of $112,500. Which of thefollowing statements is correct?
A) The profitability index is .15.
B) The present value of the net future cash flows is $862,500.
C) The internal rate of return is less than the discount rate.
D) A decrease in the discount rate would decrease the net present value.
Correct Answer:
Verified
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