The profitability index (PI) of a project is 0.9, and the initial investment (cost) is...
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Accounting
The profitability index (PI) of a project is 0.9, and the initial investment (cost) is $10,000. What do you know about the project's net present value (NPV) and its internal rate of return (IRR)?
Question options:
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| NPV may be smaller than zero |
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| NPV must be -$1,000 |
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| The IRR is the lower than the prevailing discount rate |
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| None of the above |
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