Qualitative factors that might override the acceptance of a positive NPV project include:
A) The time value of money
B) A negative environmental impact that could harm an organization's reputation
C) The discount rate
D) The risk free rate

Question

Quizplus · Accepted Answer

A negative environmental impact could harm an organization's reputation and lead to negative publicity, lawsuits, and other costs. These qualitative factors may not be reflected in the numerical analysis of NPV, but they can have a significant impact on the long-term success of the project and the company as a whole. Therefore, such factors may override the acceptance of a positive NPV project. The time value of money, discount rate, and risk-free rate are all quantitative factors that are important in calculating NPV but would not necessarily override a project with a positive NPV.

Qualitative Factors That Might Override the Acceptance of a Positive