Projects that are unrelated to one another, so that investing in one project does not preclude...
Projects that are unrelated to one another, so that investing in one project does not preclude or affect the choice about investing in the other alternatives, are
Screening projects.
Independent projects.
Mutually exclusive projects.
Preference projects.
Homework Answers
Independent projects. If choice of investment in one project has no effect on choice of investment in another project they are called independent projects.
Add Answer to:
Projects that are unrelated to one another, so that investing in
one project does not preclude...
when evaluating projects by the present worth method how do you know which one or ones to select if the a projects are i...
when evaluating projects by the present worth method
how do you know which one or ones to select if the a projects are
independent and B alternatives are mutually exclusive
4 2 When evaluating projects by the present worth method, how do you know which one(s) to select, if the (a) projects are independent, and (b) alternatives are mutually exclusive?
Consider the following projects, X and Y where the firm can only choose one. Project X...
Consider the following projects, X and Y where the firm can only choose one. Project X costs $1300 and has cash flows of $477, $111, $452, $268, $526 in each of the next 5 years. Project Y also costs $1300, and generates cash flows of $496, $293, $468, $378 for the next 4 years, respectively. WACC=7%. A) Draw the timelines for both projects: X and Y. B) Calculate the projects’ NPVs, IRRs, payback periods. C) If the two projects are...
An oil exploration company currently has two active projects, one in Asia and the other in...
An oil exploration company currently has two active projects, one in Asia and the other in Europe. Let A be the event that the Asian project is successful and B be the event that the European project is successful. Suppose that A and B are independent events with P(A) = 0.6 and P(B) = 0.7. (a) If the Asian project is not successful, what is the probability that the European project is also not successful? Explain your reasoning.Since the events...
An oil exploration company currently has two active projects, one in Asia and the other in...
An oil exploration company currently has two active projects, one in Asia and the other in Europe. Let A be the event that the Asian project is successful and B be the event that the European project is successful. Suppose that A and B are independent events with P(A)-0.9 and P(B) 0.s (a) If the Asian project is not successful, what is the probability that the European project is also not successful? Explain your reasoning. Since the events are independent,...
If the projects were independent, which project(s) would be accepted according to the IRR method? a)...
If the projects were independent, which project(s) would be
accepted according to the IRR method?
a) Neither
b) Project A
c) Project B
d) Both Projects A or B
If the projects were mutually exclusive, which project(s) would
be accepted according to the IRR method?
a) Neither
b) Project A
c) Project B
d) Both Projects A or B
The reason is
a) TheNPV and IRR approaches use the same reinvestment rate
assumption and so both approaches reach the same...
An oil exploration company currently has two active projects, one in Asia and the other in...
An oil exploration company currently has two active projects, one in Asia and the other in Europe. Let A be the event that the Asian project is successful and 8 be the event that the European project is successful. Suppose that A and B are independent events with A)-0.9 and阀8)-0.5 (a) If the Asian project is not successful, what is the probability that the European project is also not successful? Since the events are independent, then A' and B' are...
mu WSP Inc. is involved in a wide range of unrelated projects. The company will pursue...
mu WSP Inc. is involved in a wide range of unrelated projects. The company will pursue any project that it thinks will create value for its stockholders. Consequently, the risk level of the company's projects tends to vary a great deal from project to project. for special IF WSP Inc. does not risk-adjust its discount rate for specific projects properly, which of the following is likely to occur over time? Check all that apply. operty, which of ti The firm...
At various points, a firm may have more than one investment project that it is interested...
At various points, a firm may have more than one investment project that it is interested in undertaking. In this context, which of the following statements is true? a) Mutually exclusive projects are those that are unrelated. b) Under capital rationing, a firm must decide which subset of the projects available to it is the best investment strategy. c) When two projects are interdependent, accepting one project means the other must be rejected. d) The appropriate capital budgeting method for...
If Wise Guy Inc is choosing one of the above mutually exclusive projects (Project A or Project B)
If Wise Guy Inc is choosing one of the above mutually exclusive projects (Project A or Project B), given a discount rate of 7%, which should the company choose?
Which of the following statements is INCORRECT? Select one: a. For independent projects, the decision to...
Which of the following statements is INCORRECT? Select one: a. For independent projects, the decision to accept or reject will always be the same using either the MIRR method or the NPV method. b. The IRR method is appealing to some managers because it produces a rate of return upon which to base decisions rather than a dollar amount like the NPV method. c. One of the disadvantages of choosing between mutually exclusive projects on the basis of discounted payback...
when evaluating projects by the present worth method
how do you know which one or ones to select if the a projects are
independent and B alternatives are mutually exclusive
4 2 When evaluating projects by the present worth method, how do you know which one(s) to select, if the (a) projects are independent, and (b) alternatives are mutually exclusive?
An oil exploration company currently has two active projects, one in Asia and the other in Europe. Let A be the event that the Asian project is successful and B be the event that the European project is successful. Suppose that A and B are independent events with P(A)-0.9 and P(B) 0.s (a) If the Asian project is not successful, what is the probability that the European project is also not successful? Explain your reasoning. Since the events are independent,...
If the projects were independent, which project(s) would be
accepted according to the IRR method?
a) Neither
b) Project A
c) Project B
d) Both Projects A or B
If the projects were mutually exclusive, which project(s) would
be accepted according to the IRR method?
a) Neither
b) Project A
c) Project B
d) Both Projects A or B
The reason is
a) TheNPV and IRR approaches use the same reinvestment rate
assumption and so both approaches reach the same...
An oil exploration company currently has two active projects, one in Asia and the other in Europe. Let A be the event that the Asian project is successful and 8 be the event that the European project is successful. Suppose that A and B are independent events with A)-0.9 and阀8)-0.5 (a) If the Asian project is not successful, what is the probability that the European project is also not successful? Since the events are independent, then A' and B' are...
mu WSP Inc. is involved in a wide range of unrelated projects. The company will pursue any project that it thinks will create value for its stockholders. Consequently, the risk level of the company's projects tends to vary a great deal from project to project. for special IF WSP Inc. does not risk-adjust its discount rate for specific projects properly, which of the following is likely to occur over time? Check all that apply. operty, which of ti The firm...
If Wise Guy Inc is choosing one of the above mutually exclusive projects (Project A or Project B), given a discount rate of 7%, which should the company choose?
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