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Finance → Finance Quizzes from 31 to 35

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31. Net Present Value is calculated as
(A) cash inflow – cash outflow
(B) cash outflow – cash inflow
(C) PV of cash inflow – PV of cash outflow
(D) PV of cash outflow – PV of cash inflow

32. An investment should be accepted if its NPV is
(A) 0
(B) 1
(C) positive
(D) negative

33. The ratio between the amount of profit and investment is called the
(A) NPV
(B) opportunity cost
(C) risk premium
(D) rate of return

34. An investment should be accepted if
(A) Rate of Return > Opportunity Cost
(B) Rate of Return < Opportunity Cost
(C) Rate of Return = Opportunity Cost
(D) A, B and C are irrelevant

35. Governments and corporations issue bonds to
(A) borrow money
(B) lend money
(C) both A and B
(D) none of these

ANSWERS: FINANCE QUIZZES
31. (C) PV of cash inflow – PV of cash outflow
32. (C) positive
33. (D) rate of return
34. (A) Rate of Return > Opportunity Cost
35. (A) borrow money