Homework Answers
Hello,
If there are 2 mutually exclusive project we have to choose
one which has higher NPV.
Option A is correct, we cannot use Profitability index to
evaluate mutually exclusive project.
All other options are in the statement was False.
I hope this clear your doubt.
Feel free to comment if you still have any query or need something else. I'll help asap.
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This might be wrong. I need a help for correct answer. Thank
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QUESTION 14 Which...
Please help me. I want to make sure I have them right. Thank you. QUESTION 12...
Please help me. I want to make sure I have them right. Thank
you.
QUESTION 12 consider an asset that costs $431,200 and is depreciated straight line to zero over its 10-year tax life. The asset is to be used in a 4-year project; at the end of the project, the asset can be sold for $53,900. Required :If the relevant tax rate is 33 percent, what is the aftertax cash flow from the sale of this asset? (Do not...
Which of the following statements is most correct? a. The IRR method is correct under all...
Which of the following statements is most correct? a. The IRR method is correct under all circumstances when comparing mutually exclusive projects. b. The discounted payback method solves all the problems associated with the payback method. c. For independent projects, the decision to accept or reject will always be the same using either the MIRR method or the NPV method. d. All of the statements above are correct.
Which of the following statements is most correct? a. The IRR method is correct under all...
Which of the following statements is most correct? a. The IRR method is correct under all circumstances when comparing mutually exclusive projects. b. The discounted payback method solves all the problems associated with the payback method. c. For independent projects, the decision to accept or reject will always be the same using either the MIRR method or the NPV method. d. All of the statements above are correct.
Show all work and highlight final answer. Do not answer the question unless you answer all...
Show all work and highlight final answer. Do not answer the
question unless you answer all of them.
4. Which one of the following will decrease the net present value of a project? (a) Increasing the value of each of the project's discounted cash inflows (b) Moving each of the cash inflows forward to a sooner time period (c) Decreasing the required discount rate (d) Increasing the project's initial cost at time zero 5. Which of the following is true...
Which of the following is true about comparing NPV and IRR rule? (a) NPV is strictly...
Which of the following is true about comparing NPV and IRR rule? (a) NPV is strictly better than IRR so no CFO or CEO in the real world actually uses IRR. (b) No matter what the cash flow patterns are, with unlimited resources and same project lives, we can always choose the one with highest NPV among mutually exclusive projects. (c)When mutually exclusive projects have different lives, we should use IRR rather than NPV rule. (d) NPV rule guarantees correct...
by hand #1 Questions a) to c) refer to two projects with the following cash flows:...
by hand
#1 Questions a) to c) refer to two projects with the following cash flows: Year Project B Project A - $200 80 -$200 100 80 100 80 100 Projects A and B are mutually exclusive. a) Calculate the Payback, Discounted Payback, NPV, IRR, and Profitability Index for Projects A and B using an opportunity cost of capital of 10% (where applicable). Which of these projects is worth pursuing? Explain. b) Calculate the Payback, Discounted Payback, NPV, IRR, and...
a. What is the payback period for Project A? b.What is the payback period for Project...
a. What is the payback period for Project A?
b.What is the payback period for Project B?
c. What is the discounted payback period for Project A?
d. What is the discounted payback period for Project B?
e. What is the NPV for Project A?
f. What is the NPV for Project B?
g. What is the IRR for Project A?
h. What is the IRR for Project B?
i. What is the profitability index for Project A?
j. What...
Consider the following two mutually exclusive projects: Year. Cash Flow (A) Cash Flow (B). 02 -$264,129...
Consider the following two mutually exclusive projects: Year. Cash Flow (A) Cash Flow (B). 02 -$264,129 -$16,027 12 26,500 5,769 2- 53,000 8,571 56,000 13,198 4 423,000 9,431 Whichever project you choose, if any, you require a 6 percent return on your investment. a. What is the payback period for Project A?- b. What is the payback period for Project B? c. What is the discounted payback period for Project A? d. What is the discounted payback period for Project...
Consider the following two mutually exclusive projects: Year Cash Flow (A) Cash Flow (B) 0 –$194,527...
Consider the following two mutually exclusive projects: Year Cash Flow (A) Cash Flow (B) 0 –$194,527 –$15,905 1 27,700 5,627 2 52,000 8,470 3 52,000 13,908 4 413,000 8,564 Whichever project you choose, if any, you require a 6 percent return on your investment. a. What is the payback period for Project A? b. What is the payback period for Project B? c. What is the discounted payback period for Project A? d. What is the discounted payback period for...
Consider the following two mutually exclusive projects: Year Cash Flow (A) Cash Flow (B) $195,640 26,500...
Consider the following two mutually exclusive projects: Year Cash Flow (A) Cash Flow (B) $195,640 26,500 52,000 51,000 390,000 -$16,290 5,293 8,843 13,587 9,577 0 2 3 4 Whichever project you choose, if any, you require a 6 percent return on your investment. a. What is the payback period for Project A?b. What is the payback period for Project B? c. What is the discounted payback period for Project A?d. What is the discounted payback period for Project B? e....
Please help me. I want to make sure I have them right. Thank
you.
QUESTION 12 consider an asset that costs $431,200 and is depreciated straight line to zero over its 10-year tax life. The asset is to be used in a 4-year project; at the end of the project, the asset can be sold for $53,900. Required :If the relevant tax rate is 33 percent, what is the aftertax cash flow from the sale of this asset? (Do not...
Show all work and highlight final answer. Do not answer the
question unless you answer all of them.
4. Which one of the following will decrease the net present value of a project? (a) Increasing the value of each of the project's discounted cash inflows (b) Moving each of the cash inflows forward to a sooner time period (c) Decreasing the required discount rate (d) Increasing the project's initial cost at time zero 5. Which of the following is true...
by hand
#1 Questions a) to c) refer to two projects with the following cash flows: Year Project B Project A - $200 80 -$200 100 80 100 80 100 Projects A and B are mutually exclusive. a) Calculate the Payback, Discounted Payback, NPV, IRR, and Profitability Index for Projects A and B using an opportunity cost of capital of 10% (where applicable). Which of these projects is worth pursuing? Explain. b) Calculate the Payback, Discounted Payback, NPV, IRR, and...
a. What is the payback period for Project A?
b.What is the payback period for Project B?
c. What is the discounted payback period for Project A?
d. What is the discounted payback period for Project B?
e. What is the NPV for Project A?
f. What is the NPV for Project B?
g. What is the IRR for Project A?
h. What is the IRR for Project B?
i. What is the profitability index for Project A?
j. What...
Consider the following two mutually exclusive projects: Year. Cash Flow (A) Cash Flow (B). 02 -$264,129 -$16,027 12 26,500 5,769 2- 53,000 8,571 56,000 13,198 4 423,000 9,431 Whichever project you choose, if any, you require a 6 percent return on your investment. a. What is the payback period for Project A?- b. What is the payback period for Project B? c. What is the discounted payback period for Project A? d. What is the discounted payback period for Project...
Consider the following two mutually exclusive projects: Year Cash Flow (A) Cash Flow (B) $195,640 26,500 52,000 51,000 390,000 -$16,290 5,293 8,843 13,587 9,577 0 2 3 4 Whichever project you choose, if any, you require a 6 percent return on your investment. a. What is the payback period for Project A?b. What is the payback period for Project B? c. What is the discounted payback period for Project A?d. What is the discounted payback period for Project B? e....
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