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Q. |
Why are projects with negative net present values (NPVs) unacceptable to a firm? |
A. | Returns lower than the cost of capital result in firm failure. |
B. | Returns with negative NPVs cause an equal profit ratio. |
C. | Returns with negative NPVs are acceptable to a firm |
D. | Returns lower than the cost of capital result in higher profit ratios |
Answer» A. Returns lower than the cost of capital result in firm failure. |
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