Answer:
The following statement is correct:
If you have a series of cash flows, and cf0 is negative but each of the following cfs is positive, you can solve for i, but only if the sum of the undiscounted cash flows exceeds the cost. To solve for i, you must try different values for i until you find the one that causes the PV of the positive cfs to equal the absolute value of the PV of the negative cfs. This is a difficult procedure to do without a computer or financial calculator.
The statement that it is impossible to get a negative number when you solve for i is not correct. The value of i can be negative if the cash flows are not conventional, meaning that the sign of the cash flows changes more than once.
The statement that if cf0 is positive and all the other cfs are negative, then you cannot solve for i is not correct. In this case, you can still solve for i using the same procedure described above.
The statement that if you have a series of cash flows, each of which is positive, you can solve for i, where the solution value of i causes the PV of the cash flows to equal the cash flow at time 0 is not correct. In this case, the PV of the cash flows will always be greater than the cash flow at time 0, so there is no single solution for i that will make them equal.
Step-by-step explanation: