All else equal, a project's NPV increases when: The discount rate increases. Each cash inflow is delayed by one year. All cash inflows occur during the last year of a project's life instead of periodically throughout the life of the project. The initial cost of a project increases. The discount rate decreases.
Risk and return
Before understanding the concept of Risk and Return in Financial Management, understanding the two-concept Risk and return individually is necessary.
Capital Asset Pricing Model
Capital asset pricing model, also known as CAPM, shows the relationship between the expected return of the investment and the market at risk. This concept is basically used particularly in the case of stocks or shares. It is also used across finance for pricing assets that have higher risk identity and for evaluating the expected returns for the assets given the risk of those assets and also the cost of capital.
4. I need help with multiple choice finance home work question
All else equal, a project's
The NPV of a project is dependent on various factors including the future cash flows, discount rate etc.
Step by step
Solved in 2 steps
