Post Utme Abu 2025 Economics Question 9

Practice objective / multiple choice question 9 from the 2025 Post Utme Abu Economics examination.

Post Utme Abu 2025 Economics Objective / Multiple Choice
Question 9 POST_UTME_ABU • 2025 • ECONOMICS • objective

A firm is considering a new investment project. The project has a high initial \cost but is expected to generate high returns in the long run. The firm's financial manager has estimated the project's net present value (NPV) to be positive. What is the likely effect of this project on the firm's overall financial performance?

Answer Options

Correct Answer A. The project will lead to an increase in the firm's overall profitability.
B. The project will lead to a decrease in the firm's overall profitability.
C. The project will have no effect on the firm's overall profitability.
D. The project will lead to an increase in the firm's overall debt-to-equity ratio.
Correct Answer
A
Correct Option:
The project will lead to an increase in the firm's overall profitability.

About This Question

This is Post Utme Abu 2025 Economics Question 9. It is one of the objective questions from the 2025 Post Utme Abu Economics examination.

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