Final answer:
Option A is not a characteristic of NPV because risk can be accounted for in the discount rate. NPV considers all relevent cash flows, uses all cash flows of a project, and discounts all future cash flows.
Step-by-step explanation:
The correct answer to the question of which option does NOT characterize NPV (Net Present Value) is 'A. NPV does not explicitly incorporate risk into the analysis.' This statement is incorrect because NPV can indeed take into account the risk through the discount rate. A higher discount rate can be used to represent higher risk, thereby lowering the NPV, while a lower discount rate can be used for lower-risk projects, resulting in a higher NPV.
Options B, C, and D correctly characterize NPV. NPV incorporates all relevant cash flow information, meaning it accounts for both the initial investment and the expected cash flows during the project's life. NPV uses all of the project's cash flows, including those that occur throughout the project's duration, not just the initial or final ones. Additionally, NPV discounts all future cash flows to their present value, which reflects the time value of money principle that states a dollar today is worth more than a dollar tomorrow.