Multiple Choice
Which of the following statements is false?
A) Firms calculate present values when they make investment decisions because investment decisions yield benefits in the future and firms want some idea of the value of these benefits.
B) The present value of $100 a year from today at a 10 percent interest rate is approximately $91.
C) The present value of $100 two years from today at a 10 percent interest rate is approximately $83.
D) A firm will not undertake an investment if the present value of the future income resulting from the investment is greater than the cost of the investment.
Correct Answer:
Verified
Correct Answer:
Verified
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