The overall “best” capital budgeting decision method to use is: a. Payback Period b. Discounted Payback...
The overall “best” capital budgeting decision method to use is:
a. Payback Period
b. Discounted Payback Period
c. Net Present Value
d. Internal Rate of Return
Homework Answers
The overall “best” capital budgeting decision method to use is:
c. Net Present Value
This is because the method provides the actual cash inflow that will occur to the firm.
Add Answer to:
The overall “best” capital budgeting decision method to use
is:
a. Payback Period
b. Discounted Payback...
Short Answer Question What relevant information is provided with each capital budgeting method? Payback Period Discounted...
Short Answer Question What relevant information is provided with each capital budgeting method? Payback Period Discounted Payback Period Net Present Value Internal Rate of Return
Question text Which of the following statements is CORRECT? Select one: a. The discounted payback method...
Question text Which of the following statements is CORRECT? Select one: a. The discounted payback method is generally regarded by academics as being the best single method for evaluating capital budgeting projects. b. The modified internal rate of return method (MIRR) is generally regarded by academics as being the best single method for evaluating capital budgeting projects. c. The net present value method (NPV) is generally regarded by academics as being the best single method for evaluating capital budgeting projects....
-In your own words, discuss the pros and cons of the payback period, discounted payback period,...
-In your own words, discuss the pros and cons of the payback period, discounted payback period, internal rate of return, net present value, and profitability index. -Which method is the best approach to evaluate a project and why? -What is the relationship between IRR and NPV? Do they always result in the same decision? If yes then no further explanation needed and if no then under what circumstances do IRR and NPV results differ?
The ___________ decision rule is considered the “best” in theory. A. Payback Method B. Internal Rate...
The ___________ decision rule is considered the “best” in theory. A. Payback Method B. Internal Rate of Return C. Net Present Value D. Profitability Index E. All are considered equal depending on the circumstance.
The ________ method of capital budgeting finds the present value of cash inflows and subtracts the...
The ________ method of capital budgeting finds the present value of cash inflows and subtracts the initial cash outflow. a. payback b. net present value c. internal rate of return d. modified internal rate of return
F a company is in the situation of having unlimited capital funds, the best decision rule, consid...
f a company is in the situation of having unlimited capital funds, the best decision rule, considering only financial factors, is for the company to invest in all projects in which: The payback period is short. The accounting (book) rate of return (ARR) is greater than its current return on invested capital (ROI). The net present value (NPV) is greater than the cost of capital. The internal rate of return (IRR) is greater than zero. The NPV is greater than...
it CENGAGE | MINDTAP Assignment 11 - The Basics of Capital Budgeting 7. The payback period...
it CENGAGE | MINDTAP Assignment 11 - The Basics of Capital Budgeting 7. The payback period Aa Aa E The payback method helps firms establish and identify a maximum acceptable payback period that helps in their capital budgeting decisions. Consider the case of Green Caterpillar Garden Supplies Inc.: Green Caterpillar Garden Supplies Inc. is a small firm, and several of its managers are worried about how soon the firm will be able to recover its initial investment from Project Beta's...
With non-mutually exclusive projects. a. the payback method will select the best project. b. the net...
With non-mutually exclusive projects. a. the payback method will select the best project. b. the net present value is not acceptable. c. the internal rate of return method will always select the best project. d. the net present value and the internal rate of return methods will accept or reject the same project.
1. Whenever there is a conflict between NPV and another decision rule, you should always use...
1. Whenever there is a conflict between NPV and another decision rule, you should always use NPV. A. True B. False 2. ________ finds one or more companies that specialize in the product or service that we are considering. A. The Objective Approach B. The Pure Play Approach C. The Subjective Approach D. None of the above 3. The required return of bond is best estimated by computing the ________ on the bond. A. Yield-to-maturity B. market value C. Risk...
Correct or incorrect? Which of the following capital budgeting techniques consider the cost of capital? (1)...
Correct or incorrect?
Which of the following capital budgeting techniques consider the cost of capital? (1) Net Present Value (2) Internal Rate of Return (3) Profitability Index (4) Payback Period (5) Discounted Payback Period (1) (1) and (2) and (3) (1) and (2) and (3) and (5) (1) and (2)
it CENGAGE | MINDTAP Assignment 11 - The Basics of Capital Budgeting 7. The payback period Aa Aa E The payback method helps firms establish and identify a maximum acceptable payback period that helps in their capital budgeting decisions. Consider the case of Green Caterpillar Garden Supplies Inc.: Green Caterpillar Garden Supplies Inc. is a small firm, and several of its managers are worried about how soon the firm will be able to recover its initial investment from Project Beta's...
Correct or incorrect?
Which of the following capital budgeting techniques consider the cost of capital? (1) Net Present Value (2) Internal Rate of Return (3) Profitability Index (4) Payback Period (5) Discounted Payback Period (1) (1) and (2) and (3) (1) and (2) and (3) and (5) (1) and (2)
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