Brian is considering opening a McDonalds in Mumbai. His advisors believe the pro

Question

Brian is considering opening a McDonalds in Mumbai. His advisors believe the project has a net present value of zero. Which one of the following must be true? The project has no cash flows. The project has a zero percent rate of return. The project's expected cash inflows equal its cash outflows in current (present value) dollar terms. The summation of all of the project's cash flows is zero. The project requires no initial cash investment.

Widgets-R-Us Inc.'s expansion into the Starkville widget market has an initial cost of $928,400. The market value of expanding is $1,339,060. The difference between these two values is called:

Widgets-R-Us Inc.'s expansion into the Starkville widget market has an initial cost of $928,400. The market value of expanding is $1,339,060. The difference between these two values is called:

Explanation / Answer

1) "The project's expected cash inflows equal its cash outflows in current (present value) dollar terms " is correct. because if NPV is zero it means cash inflow and outflow at present terms are equal.Also it has return equal to internal rate of return (IRR).

2) the difference betwwen two values is Net Present Value

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