The net present value
A) uses the discounted cash flow valuation technique.
B) will provide a direct measure of how much a firm's value will change because of the capital project.
C) is consistent with the shareholder wealth maximization goal.
D) All of the above

Question

Quizplus · Accepted Answer

The net present value is calculated by using the discounted cash flow valuation technique, and it indicates how much a firm's value will change because of a capital project. The net present value approach is consistent with the shareholder wealth maximization goal, as it considers the time value of money and compares the cost of the investment to the present value of its expected future cash flows. Therefore, all of the above options are correct.

The Net Present Value