Question

Assume a project has normal (conventional) cash flows (i.e., initial cash flow is negative, and all other cash flows are positive). Which of the following statements is most correct? All else equal, a project's IRR increases as the required rate of return declines. All else equal, a project's IRR increases as the required rate of return increases All else equal, a project's NPV increases as the required rate of return declines. None of the above Question 11 (2 points) Suppose you invest $10,000 in asset A with an expected return of 15% and a $5000 in asset B with an expected rate of return of 9%. What is the expected return on the resulting portfolio. 11% 14% 13% 12%

Answer 1

The Hena ophon (c) & most careed is negative Inihal con flow nep all other Cash flocos are posilne poject's Np inneasy 14 enelle qual, declines rate of reum at the required Investment in Anet fa 10,000! 5000 Investment in Asser B = 15000 Toku that A = 10,000 1 SUDO weight of 0.6667 weight of Aset B 15000 0.333 Expeckexchern of na 15.1 expected rehm at - 91. expectal rehm of portfolio WARA Tel 0.6667x15+0:33x9 2 10+ 2.999 2 ophin (C)à Cand