If a project's expected rate of return exceeds its opportunity cost of capital, one would expect:...
If a project's expected rate of return exceeds its opportunity cost of capital, one would expect:
Multiple Choice
the opportunity cost of capital to be too low.
the project to have a positive NPV.
the NPV to be zero.
Homework Answers
Option '2' is correct
If a project's expected rate of return exceeds its opportunity cost of capital, one would expect the IRR to exceed the Opportunity cost of capital.
So, Investor expect The Project to have a positive NPV
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If a project's expected rate of return exceeds its opportunity cost of capital, one would expect:...
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СР, 0 A project's internal rate of return (IRR) is the -Select- that forces the PV...
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You have an opportunity to invest $49,700 now in return for $59,000 in one year. If your cost of capital is 8.2%, what is the NPV of this investment? The NPV will be $ (Round to the nearest cent.)
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17. If the profitably index for a project exceeds 1, then the project's net present value is positive a. b. internal rate of return is less than the projects's disount rate. payback period is less than 5 years. d. c. Accounting rate of return is greater than the project's rate of return. 18. If a project's profitability index is less than 1, the project's a. discount rate is above its cost of capital. b. Internal rate of return is less...
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When calculating a project's NPV, cash flows are discounted at: O A) the opportunity cost of capital. OB) the risk-free rate of return. OC) a discount rate of zero. D) the internal rate of return. 0 1 4 5 2 + 5,600 3 + + -18,000 5,600 5,600 5,600 5,600 A firm with a 14% WACC is evaluating one project for this year's capital budget. After-tax cash flows, including depreciation are attached. What is the regular payback for this project?...
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8) Project A has an internal rate of return (IRR) of 15 percent. Project B has an IRR of 14 percent. Both projects have a required retum of 12 percent. Which of the following statements is MOST correct? A) Project A must have a higher NPV than Project B. B) Both projects have a positive net present value (NPV) C) Project B has a higher profitability index than Project A. D) If the required return were less than 12 percent,...
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You have an opportunity to invest $49,700 now in return for $59,000 in one year. If your cost of capital is 8.2%, what is the NPV of this investment? The NPV will be $ (Round to the nearest cent.)
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