Which of the following projects would you feel safest in accepting? Assume the opportunity cost of capital to be 12% for each project.
A) "A" has a small, but negative, NPV.
B) "B" has a positive NPV when discounted at 10%.
C) "C's" cost of capital exceeds its rate of return.
D) "D" has a zero NPV when discounted at 14%.

Question

Quizplus · Accepted Answer

Project D has a zero NPV at 14%, which means it would have a positive NPV at the opportunity cost of capital of 12%, making it the safest choice.

Which of the Following Projects Would You Feel Safest in Accepting