Payback method is Select one: a. None of the options b. Yield on investment c. PV of cash inflow- PV of cash outflow d. Average Profit / Average Investment e. Investment / Annual cash Inflow

Q: If cashflows are discounted @   the net present value is     zero.   O a. RATE OF BORROWING…

A: Capital budgeting is the process by which a corporation examines potential large projects or…

Q: The time value of money concept is given consideration in long-range investment decisions by  Group…

A: The time value of money concept is given consideration in long-range investment decisions by :

Q: Assume a project has normal cash flows. All else equal, which of the following statements is…

A: The correct answer is option (e).   The weighted average cost of capital includes the cost of…

Q: the discount rate that equates the present value of the cash inflows with the present value of the…

A: In capital budgeting decisions calculate net present value is very important.

Q: u are given two choices of investments, Investment A and Investment B. Both investments have the…

A: Introduction: The term present value can be defined as the current value of future set of cash flows…

Q: Value One category of capital investment evaluation methods does not use present value. The primary…

A: Cash Pay Back Method and Accounting Rate of Return are two Traditional methods of capital budgeting.…

Q: On Capital Budgeting and Investment * Statement I: Accounting rate of return does not recognize the…

A: The questions are related to Capital Budgeting. The Accounting rate of return is traditional…

Q: Which of the following statements is false? (You may select more than one answer.)a. The payback…

A: Cash payback method: Cash payback period is the expected time period which is required to recover…

Q: Which decision rule assumes that project cash flows are reinvested at the firm's weighted average…

A:

Q: What name is given to the time value of money technique that discounts the after-tax cash flows for…

A:

Q: Suppose an investment has conventional cash flows with positive NPV. How would it impact your…

A: Net Present Value is Positive of the project. Impact of these measurements on the decision of…

Q: An investment is guaranteed to have a unique value of IRR if which of the following is true? a.…

A: Given: The unique IRR value in the investment.

Q: The net present value: is equal to the initial investment when the internal rate of return is equal…

A: The net present value is determined by, The Net present value (NPV) is defined as the difference…

Q: Which of the following statements is False regarding the payback period method: DA Use as a tool in…

A: Statement -D is false.As payback period method is Non- discounting cash flow criteria…

Q: All of the following statements regarding NPV are true EXCEPT: a. A positive NPV indicates the…

A: Net Present Value : It is the net of present value of cash inflow and present value of outflow.…

Q: oose the correct option- "This is the rate at which present value of cash inflows are equal to the…

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

Q: fe of the project. Which one of the following statements is correct with respect to this…

A: NPV Method assumes that all the cash flows are reinvested at the company's Cost of Capital. IRR…

Q: echnical problems associated with the internal rate of return include:

A: IRR (Internal Rate of Return): It is the rate of return that makes the net present value of the…

Q: Select the Incorrect statement concerning the present value index (PVI). Multiple Choice The PVI is…

A: Present value index or profitability index :-  It is ratio of total present value of cash inflows to…

Q: Which of the following items describes a weakness of the internal rate-of-return method?a. The…

A: IRR (Internal Rate of Return):

Q: The NPV method determines how much the present value of cash inflows exceeds the present value of…

A: The amount of difference between the PV (present value) of cash inflows and cash outflows is called…

Q: Two projects, A and B, are analyzed using ranking present worth analysis with MARR at i%. It is…

A: Cash flow is the amount of cash equivalent that the company gets or receives or gives out through…

Q: A company is considering the following three investment projects (Ignore Income taxes.): Project C $…

A: To run the business operation, the business will in need of capital. The capital will be raised by…

Q: The capital budgeting is associated with Select one: a. None of the options b. Short term assets c.…

A: Capital budgeting is the tool used to analyze the long term investment. There are different…

Q: During the operating phase but before tail phase of the project "unlevered free cash flow" is…

A: Unlevered free cash flow can be computed before the payment of interest. It refers to the cash flows…

Q: I) In IRR method the cash flows from a project are reinvested at the cost of capital. II) IRR is the…

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

Q: Suppose an investment has conventional cash flows with positive NPV. how would it impact your…

A: Conventional cash flow is a cash flow in which an investment or project has an initial cash outflow…

Q: Capital Budgeting is evaluated based on cash flows because Select one: a. Cashflows are easy to…

A: Capital budgeting is a process of making a quantitative decision with respect to the purchase or…

Q: Consider the calculation of an external rate of return (ERR). The positive cash flows in the cash…

A: External rate of return is the return rate which is expected to be generated from the project. If…

Q: An advantage of the net present value method over the internal rate of return model in discounted…

A: The internal rate of return model considers the constant discounting rate for discounting the cash…

Q: Which of the following statements related to the internal rate of return (IRR) are correct? I. The…

A: All Four options are correct.

Q: Net Cash Flows and NPVs for different discount rate for projects S and L are given below     Net…

A: IRR is the rate at which NPV of the project is equal to zero that means total PV of cash inflows…

Q: ) IRR may produce multiple rates of return when cash flows are non-conventional. B) IRR is best used…

A: Internal Rate of Return(IRR) is a financial metric for cash flow analysis that compares investments…

Q: Which of the following cash flow streams could be evaluated using the basic Internal Rate of Return…

A: Using the provided information, it could be said that that in basic internal rate of return there…

Q: a. What is the simple payback period for Alternative 1? b. What is the annual worth of Alternative…

A: As per policy we answer only 3 sub questions in a single question.  Please repost the unanswered…

Q: If cashflows are discounted at____ the net present value is zero   a. Internal rate of return…

A: Capital Budgeting entails long-term planning and monitoring of capital expenditures, as well as a…

Q: te

A: Introduction : The given question relates to the capital budgeting techniques which are used to…

Q: The profitability index O will never be greater than 1. O does not take into account the discounted…

A: The profitability index helps to compare the project. It measure the attractiveness of the project.…

Q: Project A has the following estimated cash flows and present values: Year…

A: Sensitivity analysis: Sensitivity analysis allows managers to make changes to any one of the factors…

Q: The ____ of an investment is the period of time for the ____ to equal the initial cash outlay.   a.…

A: The payback period refers to the amount of time it takes to recover the cost of an investment.…

Q: This can occur when a selection among mutually exclusive alternatives is based wrongly on…

A: Answer-    Ranking errors can occur when a selection among mutually exclusive alternatives is based…

Q: A project's internal rate of return (IRR) is the  that forces the PV of its inflows to equal its…

A: Since you have asked a question with multiple parts, we will only solve the first 3 parts for you.…

Q: ssume a project has normal cash flows. All else equal, whic llowing statements is correct? A…

A: The pay back period is the amount of time required to recover the initial amount of investment and…

Q: Which of the following statements is CORRECT? Assume that the project being considered has normal…

A: Point 1 is not correct as IRR is not found using this method. Cash flows cannot be compounded at…

Q: A company has an opportunity to invest money. Two investment alternatives are considered with…

A: Hi There, thanks for posting the question. But as per Q&A guidelines, we must answer the first…

Q: Discounted cash flow capital budgeting techniques do not O take into consideration an unconventional…

A: Discounted cash flow method is a vital capital budgeting technique. It has been explained in the…

Production Budget

A budget can be defined as a financial plan designed by an undertaking for a definite period in the future that can contribute towards enhancing the financial success of the business undertaking. It is used to estimate the revenue and expenses. The budget generally takes into account both current and future income and expenses.