A project under consideration has a net present value

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Reference no: EM13792292

A project under consideration has a net present value of $10,000 for a required investment of $60,000. There are no other investment options at this time. However, the assumed discount rate used to calculate the net present value is 20%.

On the basis of this information alone, this project should:

Definitely be rejected because $10,000 is only 17% of $60,000

Be rejected on the basis that the project loses $50,000

Probably be approved since the net present value is greater than zero

Be accepted if the cost of capital is greater than or equal to 20 percent

Reference no: EM13792292

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