The net-present-value rule is a pillar of modern finance theory. As known, it is a capital budgeting rule. Finance theory prescribes the investor to compare the opportunity in hand with an asset of equivalent risk, i.e. to discount cash flows with a risk-adjusted rate of return. This paper aims at showing that inconsistencies and antinomies arise when applying the above-mentioned rule. Further, it turns out that it is actually impossible to compare alternatives equivalent in risk and any decision maker cannot prevent herself to violate the above tenet.

Investment decisions in the theory of finance: some antinomies and inconsistencies / Magni, Carlo Alberto. - In: EUROPEAN JOURNAL OF OPERATIONAL RESEARCH. - ISSN 0377-2217. - STAMPA. - 137:1(2002), pp. 206-217. [10.1016/S0377-2217(01)00033-9]

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