You have determined the profitability of a planned project by finding the present value of all the cash flows form that project.Which of the following would cause the project to look more appealing in terms of the present value of those cash flows?
A) The discount rate decreases.
B) The cash flows are extended over a longer period of time,but the total amount of the cash flows remains the same.
C) The discount rate increases.
D) Answers b and c above.
E) Answers a and b above.

Question

Quizplus · Accepted Answer

A decrease in the discount rate increases the present value of future cash flows, making the project more appealing.

You Have Determined the Profitability of a Planned Project by Finding