An NPV of zero implies that an investment's ____________.
A) Cost exceeds the present value of its cash inflows.
B) Cost is equal to the present value of its cash inflows.
C) IRR is greater than the firm's required rate of return.
D) Present value of cash inflows are positive.
E) Present value of cash inflows exceed the investment's cost.

Question

Quizplus · Accepted Answer

An NPV (Net Present Value) of zero means that the investment's cost is exactly offset by the present value of its cash inflows, indicating that the investment is expected to generate a return exactly equal to the discount rate used in the NPV calculation.

An NPV of Zero Implies That an Investment's ____________