“All future costs are relevant in decision making.” Do you agree? Why?

Q: Which is the better investment option?

A: The process of finding the present value using the future value, interest rate and the compounding…

Q: Why future value is important to calculate?

A: Future value is the value of what a certain asset/cash/instrument will be worth at a future…

Q: What are the implications of the weak‐form, semi-strong-form, and strong-form of the EMH for…

A: The Efficient Market Hypothesis (EMH) describes a stock market that is both operationally and…

Q: How can engineers make capital-expenditure choices that are based on forecasting success?

A: As a result of this forecasting performance, engineers make capital-expenditure decisions will be…

Q: Define then discuss Value-at-Risk.

A: The stock market is full of new policies and procedures. It get impacted by change in the government…

Q: All future costs are relevant in decision making. O True O False

A: When we make decision-making, we consider the differential between the costs and the opportunity…

Q: The benefit cost ratio must be greater than or equal to ______for the project to be economically…

A: The Benefit-Cost ratio is found by Dividing the Net Present Value of Benefits of the Project by the…

Q: e optimal investment that should be recommended to Lewis

A: Combination (a):  = I + II + III + IV + V + VI  = 2,500 + 20,000 + 30,000 + 40,000 + 10,000 + 5,000…

Q: true? O Sustainability is defined as meeting the needs of the present generation without…

A: Introduction: Sustainability, GRI, CSR and SASB's are all the standards established to provide…

Q: Opportunity cost can best be defined as the O a. value of the best alternative foregone when the…

A: In cost accounting, there are various types of costs incurred and the reporting of these…

Q: Explain present value, future value, and opportunity cost.  Give an example of each concept.

A: Present value:It is the value at which the current sum of money in difference to some future value…

Q: The internal rate of return (IRR), despite its shortcomings, can be a useful analysis tool for…

A: IRR is the required rate of return for the project to have zero Net Present value.

Q: Why do most of the engineers prefer Rate of Return Analysis to the PW method?

A: Answer: They would be calculating the present worth of cash flows using a net present value…

Q: this project acceptable?

A: The return is the profit or loss that an investor anticipated on an investment. It is to be…

Q: Which of the following value is concerned with the way we approach the end states?

A: Option a

Q: If then the project is economically justified.

A: If ERR is HIGHER, then the project is economically justified.

Q: t are the problems in using the Internal Rate of Return method when making decisions on which…

A: Internal rate of return is rate at which present value of cash flow is equal to the initial…

Q: What is the potentially acceptable investment alternative?

A: An alternative investment is a financial asset that doesn't can be categorized as one of the…

Q: How can we illustrate Settlement Costs?

A: A cost is a monetary value that is incurred by the company to acquire something or to produce…

Q: How can we determine the Incremental Analysis for Cost-Only Projects?a

A: Answer: In capital budgeting, incremental analysis is one of the most common decision making methods…

Q: What are the shortcomings of the internal rate of return criterion? How do you make an investment…

A: Internal rate of return is the discount rate at which the present value of the future cash flow and…

Q: What is the criteria to accept a project based on the net present value and the internal rate of…

A: Net present value (NPV) Is the difference between present value of all cash inflows and initial…

Q: 4. Complete the decision rule for the ERR method. If, then the project is economically justified.

A: Project is economically Justified in these cases:

Q: which investment is preferable?

A: The present value is the present worth of the amount that will be paid or received at present.

Q: a. Compute the net present value of each project. b. If the company accepts all positive net present…

A: Net present value = - Initial outlay + Present value of future cash flows.  Net present value is…

Q: How is the Rate of return is an intuitively familiar and understandable measure of project?

A: Company enters into diversification once it reaches a profit level. Expanding the business is part…

Q: All future costs are relevant in decision making.” Do you agree? Explain.

A: INTRODUCTION Relevant costs are the costs which are useful for decision making. It is the costs…

Q: How can we consider the Future Worth and Project Balance?

A: The question is based on the concept of evaluation of long term investment, future worth and project…

Q: what is Political cost hypothesis ?

A: The financial statement will be prepared by the company to know the financial position of the…

Q: What is opportunity cost? Select one: O a. It is the cost of the worst opportunity when we choose…

A: Cost: In accounting, the cost is related to monetary value spend on raw material, services, and…

Q: What is the present worth equivalent of the machine considered to be the most preferred choice?…

A: Before investing in new projects, profitability of the project is evaluated by using various methods…

Q: Describe the Incremental Analysis for Cost-Only Projects?

A: The incremental cost is the additional cost incurred for producing an additional one unit of a…

Q: “All future costs are relevant.” Do you agree? Why?

A: Future cost: The cost that is expected to be incurred on the investment by the company in the future…

Q: A project will be preferred when it has:

A: Payback period is the time period in which the investment will pay its initial cost back. The…

Q: make the distinction between c

A: Rate of return refers to the percentage of profit or loss on an investment for a specified period…

Q: Which are two types of financially sound RPI strategies?

A: RPI refers to responsible property investing.

Q: If you apply the payback decision rule, which investment will you choose? Why? (b) If you apply the…

A: YEAR CASH FLOW A CASH FLOW B       0 -200000 -50000 1 40000 25000 2 60000 22000 3 80000…

Q: Dis benefits are the future costs of a project that are paid out of its benefits Select one: True…

A: Dis benefits are the estimated costs that can occur in the future while performing the project.…

Q: Discuss the advantages and disadvantages of the Net present value

A: Net present value is the method of capital budgeting that helps in determining the present value of…

Q: hich project should the company pursue? Why?

A: NPV = Present value of cashinflows - Present value of cash outlay.

Q: What is the net present value of selecting the new machine

A: Net Present Value is the difference between present value of cash inflow and present value of cash…

Q: Why is Scenario Analysis useful?

A: Scenario Analysis is a process where various (more than one) input changes are made at the same time…

Q: Which of the following terms is used to refer to opportunities that are practical and physically…

A: The answer and the explanation has been given in the next step.

Q: In what way do free resources becomes economic resources?

A: Economic resources are indeed the tools used to carry out economic transactions. Inputs into the…

Q: Why is it costly to develop resources?

A: The cost of natural resources includes the cost of acquiring and preparing the resource extraction.…