Register
Two investment opportunities have positive net present values. Investment A’s net present value amounts to $40,000 while B’s is only $30,000. Does this mean that A is the better investment opportunity?
204k views
1 vote
Two investment opportunities have positive net present values. Investment A’s net present value amounts to $40,000 while B’s is only $30,000. Does this mean that A is the better investment opportunity? Explain.

User Belhadj Haythem
by
5.7k points

1 Answer

2 votes

Answer:

Yes. A is the better investment opportunity

Reason : It has the highest net present value

Step-by-step explanation:

The Net Present Value is the Value of Future Cashflows of a Project discounted to their present (today`s) amount using the Company`s Cost of Capital. Managers should accept projects with a positive or higher Net Present Value.

User Scott Dowding
by
6.8k points
Ask a Question
Welcome to QAmmunity.org, where you can ask questions and receive answers from other members of our community.

6.5m questions

8.6m answers

Other Questions

One reason that businesses want to combine with other businesses is to A. avoid taxes. B. delay expenses. C. hire more workers. D. reduce expenses.
Which of the following possesses the sole power to create revenue bills?
A ______ is "the basic interpretive mechanism to let people know what an organization is doing and are sent out to editors and reporters in hopes of stimulating favorable stories about their organizations"
Individuals are free to produce and sell whatever products they wish
Why do objects used as money need to be in limited supply
Link Copied!