Which of the following situations suggests the acceptance of an investment proposal?

Question

Quizplus · Accepted Answer

In investment analysis, the acceptance of a proposal depends on whether the present value of the net cash inflows exceeds the initial investment. If the present value of the net cash inflows is less than the initial investment, the investment proposal should be rejected. Therefore, option A indicates the acceptance of the investment proposal. Option B suggests the rejection of an investment proposal as the IRR should be greater than the hurdle rate for acceptance. Option C also suggests rejection as the cash inflows are lesser than the initial investment. Option D may be a factor to consider, but it is not enough to suggest the acceptance of an investment proposal by itself.

Which of the Following Situations Suggests the Acceptance of an Investment