Net present value is based on computing the quantity of goods a company needs to sell to just cover its costs.

Question

Quizplus · Accepted Answer

Net present value (NPV) is the difference between the present value of cash inflows and the present value of cash outflows over a period of time, taking into consideration the time value of money. It is not directly related to the quantity of goods sold by a company or its costs.

Net Present Value Is Based on Computing the Quantity of Goods