The factor that is normally used as the discount rate in NPV method. Introduction: Net present value (NPV): It is the method that helps estimate the worth of investment by deducting the present value of cash outflow from the present value of cash inflow . If the NPV is positive, the project is profitable and should be accepted and if the NPV is negative, the project is not profitable and should not be accepted.

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Answer 1

Question

Chapter 12, Problem 4DQ

Summary Introduction

To explain: The factor that is normally used as the discount rate in NPV method.

Introduction:

Net present value (NPV):

It is the method that helps estimate the worth of investment by deducting the present value of cash outflow from the present value of cash inflow. If the NPV is positive, the project is profitable and should be accepted and if the NPV is negative, the project is not profitable and should not be accepted.

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Students have asked these similar questions

a. what is the difference between the discount rate used for net present value and the internal rate of return methods?

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why does an increase in the discount rate resuce the present value?

Answer 2

Question

Chapter 12, Problem 4DQ

Summary Introduction

To explain: The factor that is normally used as the discount rate in NPV method.

Introduction:

Net present value (NPV):

It is the method that helps estimate the worth of investment by deducting the present value of cash outflow from the present value of cash inflow. If the NPV is positive, the project is profitable and should be accepted and if the NPV is negative, the project is not profitable and should not be accepted.

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Answer 3

Question

Chapter 12, Problem 4DQ

Summary Introduction

To explain: The factor that is normally used as the discount rate in NPV method.

Introduction:

Net present value (NPV):

It is the method that helps estimate the worth of investment by deducting the present value of cash outflow from the present value of cash inflow. If the NPV is positive, the project is profitable and should be accepted and if the NPV is negative, the project is not profitable and should not be accepted.

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Answer 4

Question

Chapter 12, Problem 4DQ

Summary Introduction

To explain: The factor that is normally used as the discount rate in NPV method.

Introduction:

Net present value (NPV):

It is the method that helps estimate the worth of investment by deducting the present value of cash outflow from the present value of cash inflow. If the NPV is positive, the project is profitable and should be accepted and if the NPV is negative, the project is not profitable and should not be accepted.

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Answer 5

Chapter 12, Problem 4DQ

Summary Introduction

To explain: The factor that is normally used as the discount rate in NPV method.

Introduction:

Net present value (NPV):

It is the method that helps estimate the worth of investment by deducting the present value of cash outflow from the present value of cash inflow. If the NPV is positive, the project is profitable and should be accepted and if the NPV is negative, the project is not profitable and should not be accepted.

Answer 6

Chapter 12, Problem 4DQ

Summary Introduction

To explain: The factor that is normally used as the discount rate in NPV method.

Introduction:

Net present value (NPV):

It is the method that helps estimate the worth of investment by deducting the present value of cash outflow from the present value of cash inflow. If the NPV is positive, the project is profitable and should be accepted and if the NPV is negative, the project is not profitable and should not be accepted.

Answer 7

Chapter 12, Problem 4DQ

Summary Introduction

To explain: The factor that is normally used as the discount rate in NPV method.

Introduction:

Net present value (NPV):

It is the method that helps estimate the worth of investment by deducting the present value of cash outflow from the present value of cash inflow. If the NPV is positive, the project is profitable and should be accepted and if the NPV is negative, the project is not profitable and should not be accepted.

Answer 8

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Answer 11

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Solution Summary: The author explains Net present value (NPV) as a discount rate for determining the worth of investment by deducting cash outflow from cash inflow.

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