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If a company uses a 11.6% discount rate with the net present value method, and then does the same analysis, but with a 15.1% discount
If a company uses a 11.6% discount rate with the net present value method, and then does the same analysis, but with a 15.1% discount rate, which of the following is likely to occur? The relative profitability of the two studies depends only on the timing of the cash flows, not on the discount rate. The 11.6% rate will show the project is more profitable than the 15.1% rate. Both rates will produce the same net present value. The 15.1% rate will show the project is more profitable than the 11.6% rate. eTextbook and Media
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