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A project requires an initial investment of $10 million today. If the cost of capital exceeds the project IRR, then the project must have a(n):

User Lind
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1 Answer

7 votes

Answer:

Negative NPV.

Step-by-step explanation:

present value of cost exceeds present value of revenue that is been assumed in the investment plan of the said company/firm.

Net Present Value describes one of the discounted techniques of cash flow used in capital budget to determining the viability of a project or an investment. It is seen to have a huge difference between the present flow of the firms; which is cash inflows and the present value of cash outflows over a period of time. Experts has tagged its primary advantage to be that it is seen to considers the concept of the time value of money.

User Jonny
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