Question

V. Each project should be judged against

A. the specific means of financing used to support its implementation.
B. the going interest rate at that point in time.
C. the cost of new common stock equity.
D. the weighted average cost of capital

VI. With nonmutually exclusive events and no capital rationing, we will usually arrive at the same conclusions using either the net present value or internal rate of return methods.
A. True

B. False

VII. The payback period is easy to understand and places a heavy emphasis on liquidity.
A. True

B. False

VIII. Sensitivity analysis helps the financial planner to determine how sensitive shareholders will be to changes in investment strategy.
A. True

B. False

VIIII. Choosing projects with returns equal to the company norm but having a higher level of risk will most likely lower the company's share price.
A. True

B. False

X. Combining assets that have highly correlated returns will reduce portfolio risk.

A. True
B. False

Answer 1

V.
A. the specific means of financing used to support its implementation.

VI.
A. True

VII.
A. True

VIII.
B. False

VIIII.
A. True

X.
B. False