Indicate whether each of the following statements is true or false.
1. If two capital investments both have positive net present values, both offer an actual rate of return that is higher than the required rate of return.
2. Company M has two potential capital investments, each of which has a positive net present value. M can only accept one of the investments. In this situation, it should always accept the project that has the higher net present value.
3. Net present value is calculated by dividing the present value of cash inflows by the present value of cash outflows associated with a capital investment.
4. The present value index can be used to compare different capital investment projects.
5. The higher the present value index, the lower the rate of return per dollar invested in the project.

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The Answer of Indicate whether each of the following statements is true or false.
1. If two capital investments both have positive net present values, both offer an actual rate of return that is higher than the required rate of return.
2. Company M has two potential capital investments, each of which has a positive net present value. M can only accept one of the investments. In this situation, it should always accept the project that has the higher net present value.
3. Net present value is calculated by dividing the present value of cash inflows by the present value of cash outflows associated with a capital investment.
4. The present value index can be used to compare different capital investment projects.
5. The higher the present value index, the lower the rate of return per dollar invested in the project.

Indicate Whether Each of the Following Statements Is True or False