Multiple Choice
When the costs of an investment come before that investment's benefits,what will be the the effect of a rise in interest rates on the attractiveness of that investment to potential investors?
A) It will make it more attractive,since it will increase the investment's net present value (NPV) .
B) It will make it more attractive,since it will decrease the investment's net present value (NPV) .
C) It will make it less attractive,since it will increase the investment's net present value (NPV) .
D) It will make it less attractive,since it will decrease the investment's net present value (NPV) .
E) It will be unchanged,since NPV calculations ignore changes in interest rates to more accurately compare the NPVs of projects beginning at different times.
Correct Answer:

Verified
Correct Answer:
Verified
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