The break-even value calculation is similar to the calculation we use for theinternal rate of return. True or false?

Q: Assuming that the pure expectations theory is correct, how are expected short-termrates used to…

A: Pure expectations theory believes that expected future rates can be represented by the forward…

Q: When comparing two mutually exclusive alternatives by the ROR method, if the rate of return on the…

A: Option (d) i.e. the lower first cost alternative should be selected.

Q: What is the marginal rate of return? How is it calculated?

A: Answer: Marginal rate of return can be defined as the return obtained or received by means of…

Q: a. what is the difference between the discount rate used for net present value and the internal rate…

A: Discount rate used for net present value is rate which investor want to earn from a project . It is…

Q: Which of the following statements is/are false, all else the same? 1. Present values increase as the…

A: Present value means the value of the future cash flow as of today. And this is done by using the…

Q: Which of the following statements is true about the present value factors? The present value factor…

A: Present value interest factor is used to determine the present value of series of future annuities.…

Q: What is meant by the term abnormal rate of return?

A: Abnormal rate of return is return earned above or below the normal rate of return.

Q: According to the pure expectations theory, what would happen if long-term rateswere not an average…

A: Expectation theory: The theory states that the future short term rate will be based on current long…

Q: What security provides a good estimate of the short-term nominalrisk-free rate?

A: T-bills are the treasury bills issued by the government. These bills are risk-free and the rate of…

Q: which of the following is true? a lower payment amount results in a higher FV, other things equal.…

A: Future value is the value of the money invested today at some future date on the basis of the…

Q: What is the difference between the possible returns and the expected return?

A:

Q: If I have that the standard estimator of the volatility parameter is 0.2491, how can I estimate the…

A: The geometric Brownian motion (BM), in stock prices is given by the relationship: S(t) =…

Q: True or false  When the net present value is negative, the present value index will be greater than…

A: Net present value: It is the technique used for analyzing investment in long term capital projects.…

Q: The internal rate of return (IRR) is the discount rate that results in a net present value (NPV) of…

A: According to rule, because you have posted multiple questions, we will answer the First question…

Q: How is it possible to achieve a higher rate of return without significantlyincreasing risk?

A: As we all learnes till now that higher the risk provides higher return and if we want the high…

Q: standard deviation of returns?

A: Risk is the value of volatility around the mean. It is measured via variance or square root of…

Q: The difference between the expected return and the actual return is referred to as the unexpected…

A: The excess amount over invested value that an investor estimates to realize over horizon of…

Q: Which of the following is not a variable in the basic present value equation? Multiple Choice…

A: Investors are holding securities for the purpose of gaining the returns. The return is calculated…

Q: Describe the advantages of the dollar-value LIFO method.

A: Definition:   Dollar value LIFO method: In this method, the valuation of inventory is calculated on…

Q: The modified internal rate of return (MMIR) is the discount rate that forces the _____.

A: Explanation: Modified internal rate of return can be better understood from the below formula, where…

Q: When npv is negative, the discount rate is greater than the actual return on investment. A.…

A: Net present value is the method used in capital budgeting to analyse various investments, projects,…

Q: o you think a person would opt to use the Payback Period Method instead of the Net Present Value or…

A: Given information : . NPV refers to the difference between the sum of the present value of expected…

Q: What is a minimum attractive rate of return (MARR)?

A: Definition: Minimum Attractive Rate of Return (MARR): It is the minimum rate of return on the basis…

Q: Are you agree with the - return curve slop of a risky has a negative slop."? explain why?**…

A: The exchange rate indifference curve is the curve between the exchange rate and demand for given…

Q: The interest rate is the IRR for the mixed investment. True or false?

A: Project Balance (PB) is the amount of investment that is made into a project at any given period of…

Q: If the calculated NPV is negative, then which of the following must be true? O No answer text…

A:

Q: Calculate the dollar-denominated returns for each scenario. should be indicated by a minus sign.)

A: Exchange rate(ER) is that rate at which national currency can be valued in terms of foreign…

Q: Which of the following methods does not consider the investment’s profitability? ARR Payback NPV…

A: Average rate of return (ARR) and Internal rate of return (IRR) are methods of computing rate of…

Q: INTEREST RATE RISK  In the context of the repricing gap model, what is the spread effect? How does…

A: The repricing gap model is based on the consideration that a bank's exposure to interest rate risk…

Q: Use a numerical example to illustrate that when there is a large change in the interest rate, the…

A: Duration of bond price is to measure the interest rate risk and also the convexity is utilized to…

Q: /hat is the exact rate of return?

A: MACHINE A         PV FACTOR PRESENTVALUE A 0 FIRST COST -8000   8000…

Q: Does the Present Value (PV) technique is based on return?

A: One of the important decisions that are taken by the management is to make the investment decisions…

Q: Is a cap rate the same as an IRR? Which is generally greater? Why?

A: The capitalization rate or cap rate cant be considered as similar to the IRR or the internal rate of…

Q: The risk-adjusted discount rate reduces investment. True or false?

A: The estimation of the present value of cash for high-risk investment is known as a risk-adjusted…

Q: The minimum acceptable rate of return for an investment decision is called the;

A: A project to become acceptable shall be as such the costs shall be recovered completely.

Q: Why do some people say that MIRR should stand for Meaningless Internal Rate of Return?

A: Question is based on the concept of Business Finance

Q: When performing present worth analysis, a future worth taking inflation into consideration tends to…

A: Present worth is computed by discounting the future cash flows from the security or the project.

Q: have led to a drop in the required rate of return?

A: Required Rate of return is the minimum rate of return which an investor expects for investing in a…

Q: Another term for return is ..................

A: Return means money which is earned or lost in the process of investment. Return  can be in the form…