Which statement about an NPV profile graph is true?
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An NPV profile graph shows how a project’s IRR varies as the cost of capital changes.
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An NPV profile graph is designed to give decision makers an idea about how a project’s contribution to the firm’s value varies with the cost of capital.
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We cannot draw a project’s NPV profile unless we know the appropriate WACC for use in evaluating the project’s NPV.
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The NPV profile graph for a normal project will generally have a negative (downward) slope as the life of the project increases.