Question

    If the NPW is zero, then B/C ratio

    is
    A > 1 Correct Answer Incorrect Answer
    B < 1 Correct Answer Incorrect Answer
    C = 1 Correct Answer Incorrect Answer
    D = 0 Correct Answer Incorrect Answer

    Solution

    NPW is zero, the numerator of the B/C ratio (present value of cash inflows) is also zero. Dividing zero by any non-zero value would result in a B/C ratio of zero.

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