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Proper Treatment of Inflation in the NPV Calculation Involves

Question 71

Multiple Choice

Proper treatment of inflation in the NPV calculation involves:
I. Discounting nominal cash flows using the nominal discount rate II) Discounting real cash flows using the real discount rate
III. Discounting nominal cash flows using the real discount rates


A) I only
B) II only
C) III only
D) I and II only

Correct Answer:

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