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The Likely Effect of Discounting Nominal Cash Flows with Real

Question 67

Multiple Choice

The likely effect of discounting nominal cash flows with real interest rates will be to:


A) make an investment's NPV appear more attractive.
B) make an investment's NPV appear less attractive.
C) correctly calculate an investment's NPV if inflation is expected.
D) correctly calculate an investment's NPV, regardless of expected inflation.

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