A firm should never undertake an investment if accepting the project would cause an increase in the firm's cost of capital.

Managerial Accounting: The Cornerstone of Business Decision-Making
7th Edition
ISBN:9781337115773
Author:Maryanne M. Mowen, Don R. Hansen, Dan L. Heitger
Publisher:Maryanne M. Mowen, Don R. Hansen, Dan L. Heitger
Chapter12: Capital Investment Decisions
Section: Chapter Questions
Problem 12MCQ: Using NPV, a project is rejected if it is a. equal to zero. b. negative. c. positive. d. equal to...
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A firm should never undertake an investment if accepting
the project would cause an increase in the firm's cost of
capital.
Transcribed Image Text:A firm should never undertake an investment if accepting the project would cause an increase in the firm's cost of capital.
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