Answer:
If net present value of a project is greater than zero (i.e is positive) then the project generates wealth.
Explanation:
A project can only have a net present value greater than zero, which means a positive net present value, only if the sum of the present value of its expected cash inflows is greater than the present value of cash outflows. If this is the case, then the project is profitable and generates wealth.
Please note that it is possible for a project to have multiple cash outflows, which is why this solution is not comparing the present value of the project’s expected cash inflows to the initial outlay only but is making reference to the present value of all cash outflows.
