Part B's option is Reject/Accept as well

5. NPV profiles An NPV profile plots a project's NPV at various costs of capital, labeled "A" and "B" in the graph. A project's NPV profile is shown as follows. Identify the range of costs (ranges labeled "A" and "B") of capital that a firm would use to accept and reject this project. NPV (Dollars) A B 0 2468 10 12 14 16 18 20 COST OF CAPITAL (Percent) A B Reject The poi Accept ch the NPV profile intersects the horizontal axis represents the 400 300 200 100 0 -100 -200 A B The point at which the NPV profile intersects the horizontal axis represents the IRR WACC