A $25 Investment Produces $27

Multiple Choice

A $25 investment produces $27.50 at the end of the year with no risk. Which of the following is true?

A) NPV is positive if the required return is less than 10%.
B) NPV is negative if the required return is less than 10%.
C) NPV is zero if the required return is equal to 10%.
D) Both NPV is positive if the required return is less than 10%; and NPV is zero if the required return is equal to 10%.
E) None of these.