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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