CHAPTER 7 Net Present Value and Other Investment Rules Multiple Choice Questions: I. DEFINITIONS NET PRESENT VALUE a 1. The difference between the present value of an investment and its cost is the: a. net present value. b. internal rate of return. c. payback period. d. profitability index. e. discounted payback period. Difficulty level: Easy NET PRESENT VALUE RULE c 2. Which one of the following statements concerning net present value (NPV) is correct? a. An investment should be accepted if, an
