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

Q: Required: (Ignore income taxes.) Which investment alternative (if either) would you recommend that…

A: Net present value (NPV) is excess of present value of cash inflows over present value of cash…

Q: What would you recommend if the benefit / cost ratio is >1: Select one:   a. Benefit/cost ratio…

A: In very long term projects of government and social nature Benefits/cost ratio is considered.

Q: Why would the average rate of return differ from the internal rate of return on the same project

A:

Q: What is the NPV decision rule for discretionary mutually exclusive projects? A. Accept the project…

A: There are two types of projects: Independent projects. Mutually exclusive projects. Independent…

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: Besides the dollar cost, what other costs should you consider when comparing alternative solutions…

A: A company will incur various costs to earn revenue. The costs can be either direct or indirect costs…

Q: total accrued cost of the project includes all the direct cost.  true or false?

A: Accrued expenses are those expenses that are identified before it has been paid. Expenses are…

Q: Is the IRR measure also used to compare projects with unequal lives?

A: The internal rate of return (IRR) is a capital budgeting metric used to gauge the benefit of…

Q: A project’s IRR is the discount rate that causes the PV of the inflows to equal the project’s cost.…

A: The given statement is true.

Q: What are the factors affecting the discount rate used in project valuation?

A: Higher discount rate provides less value and lower the discount rate higher the value of the…

Q: When evaluating projects by the present worth method, how do you know which one(s) to select if the…

A:

Q: How can the working-capital requirements significantly reduce a project's profitability or rate of…

A: More risky investments would bring about more returns. In this manner, an organization with high…

Q: pted when profitability index will be greater than one b. All statements are corre

A: Profitability index indicates present value of cash inflows as no. of times of present value of cash…

Q: Which of the following should not be included as an application of the rate of return concept? rate…

A: As per the guidelines, only one question is allowed to be answered so, I am answering question no.…

Q: When using the benefit–cost method of analyzing a project, which of the following is a true…

A: The benefit cost ratio is calculated by dividing the present value of benefits derived from a…

Q: 1) What is after-tax PW of alternative 1? 2) What is after-tax PW of alternative 2? 3) Which…

A: Calculating a present worth (PW) of any project is a capital budgeting technique that ensures that…

Q: It is good to compute first the additional benefits that a project can give and the additional cost…

A: Meaning of the given options:: a) Law of supply and demand- The law of demand states that when price…

Q: Use the information below and help the management in choosing the most desirable Project using a.…

A: Capital budgeting is referred as the process of decision making which is used by companies to…

Q: The minimum acceptable rate of return vary from project to project for which reason? Select one: a.…

A: Minimum Acceptable Rate of Return (MARR) is the target rate of return used to evaluate the project…

Q: Describe the method of Investment Decision for a Nonsimple Project?

A: In a simple investment, cash flows change sign only one time. For example, negative cash flow in the…

Q: f the projects are mutually exclusive, highest payback period project will accept normally. a. True…

A: Payback period is the time it takes to recover the cost of an investment

Q: xplain why sunk costs should be excluded from a capital budgeting study while opportunity costs and…

A: answer are as follows

Q: ompute the avoidable interest on this project. (Us

A: Loan name Loan amount Interest rate Interest payment frequency 12% Construction Loan…

Q: Which of the following statements regarding the net present value rule and the rate of return rule…

A: The question is based on the concept of Financial analysis.

Q: According to the Discounted Payback method, which project should be selected? What is the chief…

A: According to the given information, Project D is said to have lesser discounted payback period…

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: Which of the following is not a criterion that is used to determine whether a project is acceptable…

A: A project is accepted when NPV is greater than or equal to zero. If NPV is Negative then the project…

Q: Calculate discounted payback period of Project A and B Calculate net present value of A and B Which…

A: solution cash flows given year cash flow A cash flow B 0 -150000 -150000 1…

Q: 1. State the criterion for accepting or rejecting independent projects under each of the following…

A: Capital budgeting is a technique to evaluate long term projects. For evaluating, various methods are…

Q: method. Does the project offer an acceptable rate of return? Evaluate the profitability measure…

A: Revenue = $11 *106 Fixed costs = $2*106 Variable cost = $7*106 Depreciation is $2.4 *106 /year  for…

Q: How can we use the PW criterion to compare the alternatives to minimize expenditures?

A: The full form of PW is present worth. Present worth is known as the present value of the investment…

Q: Calculate cach project's Payback Peried. Based on the payback periods, which project(s) should they…

A: Payback Period: It is the period in which the investment or project recovers its initial cost. A…

Q: In calculating the Net Present Value, the project would be acceptable if the outcome was: Group of…

A: The net present value is calculated as the difference of present value of cash inflows minus present…

Q: ) What are the factors affecting the discount rate used in project valuation?

A: Discount rate also called as Weighted average cost of capital is used for discounting future cash…

Q: A project's return is referred to as the yield promised by an im·cstment project over its useful…

A: Yes, the project return is referred to as the yield assured by the investment project over project’s…

Q: The benefit-cost ratio of a project represents its time-valued benefit per unit investment (first…

A: The question is based on the concept of Accounting Theory.

Q: For a capital investment project to be acceptable, it must generate a rate of return  A) Less than…

A: The correct answer id Option (B).

Q: b. Discounted payback ou have to comment and suggest to the management which project to choose nd…

A: Given, Initial Investment = 15000 Cost of capital = 5.005%

Q: Which of the following is an advantage of Net present value? a. Investment potential ignored b.…

A: Net present value (NPV): The net present value is a technique used for making the investment…

Q: Financially, what is the economic worth of outbidding thecompetitors for a project?

A: Companies often exploit opportunities in the market because they will create positive NPV for the…

Q: Outline any problems you are aware of associated with the discounting of future costs and benefits…

A: The discounting of future cost means that because that will be incurred in future and discounted…

Q: The net present method calculates the present value of all costs and benefits of the project a) TRUE…

A: SOLUTION- NET PRESENT VALUE  IS THE DIFFERENCE BETWEEN THE PRESENT VALUE OF CASH INFLOWS AND PRESENT…