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A project's cash flows are discounted by 16% and result is a positive net present value. The positive net present value indicates that the project?

a) Has an Internal rate of return greater than16%

B) Has an internal rate of return equal to investment

c) Has an internal rate of return less than16%

d) None of the above.

Accounting Value Based Selling Cash Flow Forecasting Cash Flow Lending Management
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Question added by Mohammed Asim Nehal , M Asim Nehal & Co , Chartered Accountants
Date Posted: 2015/08/01
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sudhir pv
by sudhir pv , Chief Accountant , GM-BAHRAIN

NPV is postive means project is profitable. NPV is positive when initial outlay is less then the present value

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The positive net present value indicates that the project's internal rate of return is greater than 16%. It also indicates that the project's profitability index is greater than 1.

MUHAMMAD NAZEER
by MUHAMMAD NAZEER , Banking Services Officer , ALLIED BANK LIMITED

(a) has an internal rate of return greater than16%

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