The net working capital invested in a project is generally:

a sunk cost.

depreciated to a zero balance over the life of the project.

recouped at the end of the project.

recouped in the first year of the project.

When the projectability index is greater than one, the costs exceed the benefits.

True or False

The internal rate of return is the:

A. rate computed by discounting the cash inflows and dividing by the initial cost.

B. rate of return required by a firm's management for a particular project

C. discount rate that causes the net present value of a project to equal zero.

D. rate of return needed for a project to payback within the allotted time period.

Under what conditions can we expect IRR and NPV to always be consistent in accepting or rejecting projects?

A. The projects have standard cash flows.

B. The projects are independent.

C. The projects involve short-term investments.

D. only a and b

E. All of the above