a. If you are evaluating a project that has a cost of capital of 12% and your analysis results in a negative NPV, which of the following statements is true?
The IRR is higher than 12%.
There is no relationship between the IRR and the NPV.
The IRR is lower than 12%.
The IRR is exactly equal to 12%.
b. A company's 'bottom line' or net income decreased. Which of the following statements is most correct?
Either sales decreased, expenses increased, or both may have happened.
The only possible cause is that sales decreased.
Either sales increased, expenses decreased, or both may have happened.
The only possible cause is that expenses increased.