An MNC's parent would consider investing in a target only if the estimated present value of the cash flows it would ultimately receive from the target over time ____ the initial outlay necessary to purchase the target.
A)is less than
B)is the same as
C)is greater than
D)none of the above

Question

An MNC's parent would consider investing in a target only if the estimated present value of the cash flows it would ultimately receive from the target over time ____ the initial outlay necessary to purchase the target.​
A)is less than
B)is the same as
C)is greater than
D)none of the above

Quizplus · Accepted Answer

An MNC's parent would consider investing in a target only if the estimated present value of the cash flows it would ultimately receive from the target over time is greater than the initial outlay necessary to purchase the target. This is because the primary objective of any investment is to earn a return that is greater than the cost of capital invested in it. Hence, answer choice C is the correct choice.

An MNC's Parent Would Consider Investing in a Target Only