Pick up the correct statement from the following: A. A NPV profile graph shows the curvilinear relationship between the net present value of the project and discount rate employed B. In a NPV profile, if discount rate is zero, then net present value is simply total cash inflows less the total cash outflows of the project C. As the discount rate increases, the net present value profile slopes downward to the right D. All of these

The correct answer is D. All of these.

A NPV profile graph shows the curvilinear relationship between the net present value

of the project and discount rate employed. The NPV profile is downward sloping to the right because the present value of a future cash flow decreases as the discount rate increases.

In a NPV profile, if discount rate is zero, then net present value is simply total cash inflows less the total cash outflows of the project. This is because the present value of a future cash flow is equal to the cash flow itself when the discount rate is zero.

As the discount rate increases, the net present value profile slopes downward to the right. This is because the present value of a future cash flow decreases as the discount rate increases.