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Consider a project with only positive cash flows after year 0. If the company felt that the risk of the project was less than original

Consider a project with only positive cash flows after year 0. If the company felt that the risk of the project was less than original estimates, which of the following would occur?

Answer:

Required Rate of Return

Net Present Value

Internal Rate of Return

A

Higher

Higher

Lower

B

Higher

Lower

No Change

C

Lower

Lower

Higher

D

Lower

Higher

No Change

E

No Change

Higher

No Change

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