Asked by
Keri E Hennessee
on Dec 09, 2024
Verified
If a project has a net present value equal to zero, then any delay in receiving the projected cash inflows will cause the project to have a negative net present value.
Net Present Value
A method used to evaluate an investment's profitability by calculating the present values of all cash inflows and outflows.
Delay
The act or instance of postponing or hindering a process, decision, or action.
Projected Cash Inflows
Estimated future cash receipts resulting from business activities like sales, dividends, or loan repayments.
- Acquire knowledge on the subject of Net Present Value (NPV) and its essential importance in the evaluation of a project.
- Understand the impact of cash flow timing on the valuation of a project.
Verified Answer
BK
Learning Objectives
- Acquire knowledge on the subject of Net Present Value (NPV) and its essential importance in the evaluation of a project.
- Understand the impact of cash flow timing on the valuation of a project.