Which of the statements is true of hannibal inc

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Question 1: Hannibal Inc., a local butcher, is considering replacing its current refrigerator used for storing meats with a larger one. The estimated cost of the new refrigerator will be $30,000. Using a discount rate of 15%, the company calculates a net present value for the new refrigerator of $6,000. Based on this information, which of the following statements is true?

Option A.) If the actual cost of the new refrigerator ends up being less than $30,000, the company should not make the investment

Option B.) If the actual cost of the new refrigerator ends up being less than $36,000, the net present value will become negative

Option C.) If the actual cost of the new refrigerator ends up being greater than $36,000, the net present value will become negative.

Option D.) If the actual cost of the new refrigerator ends up being $30,000, the actual rate of return is equal to 15%

Reference no: EM132529142

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