If the net present value analyses of a project resulted in a positive value and the company does not accept the project, it may be assumed that
A) qualitative factors outweigh the benefit of the investment.
B) An alternative project has a lower NPV.
C) the net initial investment cannot be recovered.
D) the return is greater than that required by the company.
E) quantitative factors outweigh the benefit of the investment.

Question

Quizplus · Accepted Answer

If the net present value analysis resulted in a positive value, it means that the project is expected to generate more cash inflows than outflows over its lifetime when discounted at the required rate of return. Therefore, the project would enhance the company's value. If the company still decides not to accept the project, it may be due to qualitative factors such as strategic fit, risk profile, or non-financial considerations, which may outweigh the benefits of the investment.

If the Net Present Value Analyses of a Project Resulted