What should an analyst recommend based on the following information for two mutually exclusive projects Project Investment at t=0 Cash Flow at t=1 IRR NPV at 10% a b -$5000 -$20000 $7000 $25000 40% 25% $1364 $2727
Accept a and reject b.
B. Reject a and accept b.
C. Accept a and b.
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Terrison Inc. is considering the purchase of a new material handling system for a cost of $43 million. This System is expected to generate a positive cash flow of $5 million per year in perpetuity. What is the NPV of the proposed investment if the appropriate discount rate is 7%
A. $6753582
B. $28428571
C. $34395213
Two events are said to be independent if the occurrence of one event:
A. means that the second event cannot occur.
B. means that the second event is certain to occur.
C. does not affect the probability of the occurrence of the other event.
What is the bank discount yield for a T-bill that is selling for $48 000, with a face of $50 000, and 270 days remaining until maturity
A. 5.3%
B. 6.7%
C. 13.4%
Which of. the following statements least likely represents a characteristic of the time-weighted rate of return
A. It is not affected by the timing of cash flow.
B. It is used to measure the compound rate of growth of $1 over a stated measurement period.
C. It is defined as the internal rate of return on an investment portfolio, taking into account all inflows and outflows.