Explain why the IRR may contradict the ranking of NPV and therfore not recmmeneded to use when choosing among mutually exclusive projects.\ (5 lines)
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- Do NPV and IRR always yield the same conclusion (accept or reject a project)? If not, when do they not yield the same conclusion? Short Answer Toolbar navigation BIUS Ab) Using data provided below, compute appropriate values and fill the table below to help identify the least risky and most risky project among alternatives A, B and C using appropriate criteria. Project EV D D2 Var St. dev Coef.0f Var TT 12 0.2 A 18 0.7 28 0.1 10 0.3 В 22 0.6 32 0.1 11 0.1 C 21 0.8 31 0.1 Where n denotes the profit, P is the probability, EV stand for Expected value, D is the Deviation, D$ denote the deviation square, St. dev is the standard deviation and finally Coef.of Var is the coefficient of variation.29....When using the NPV method the decision making rationale includes the following (select all that apply): a.If projects are mutually exclusive, accept the project with the highest positive NPV. b.If projects are independent, accept if the project NPV<0. c.If projects are independent, accept if the project NPV>0 d.If the projects are mutually exclusive, accept the project with lowest NPV.
- What would you recommend if the benefit / cost ratio is >1: Select one: a. The project must be accepted. b. Benefit / cost ratio cannot be >1 c. The project must be rejected. d. Benefit / cost ratio always =1What would you recommend if the benefit / cost ratio is >1: Select one: a. Benefit/cost ratio always =1 b. The project must be rejected. c. Benefit / cost ratio cannot be >1 d. The project must be acceptedState the decision criteria for each of the following. (2) PI > MIRR > NPV > IRR > options; 0 1 PI MIRR NPV IRR Payback
- 1- Please name the goals of models. 2- Please define risky project. 3- Please name two Criteria for evalu...ng pject decisions. 4- Please define the value of information about projects. 5- Are you agree with the phrase(sentence): "The indifference (exchange) risk - retur curve slop of a risk aversion has a negative slop."? explain why? (4)When faced with a set of independent projects, one should select (choose the best answer) A. all projects with an IRR greater than the hurdle rate or a Pl greater than one. B. all projects with a positive NPV or a Pl greater than the one. all projects with a positive NPV or an IRR greater than the hurdle rate or a PI greater than one. C.all projects with a positive NPV or an IRR grcater than the hurdle rate. D. all projects with a Pl greater than one, all projects with a positive NPV E. all projects with an IRR greater than the hurdle rateWhen faced with a set of independent projects, one should select (choose the best answer) A. all projects with a positive NPV or an IRR greater than the hurdle rate or a PI greater than one. B. all projects with a PI greater than one. C. all projects with an IRR greater than the hurdle rate D. all projects with a positive NPV or an IRR greater than the hurdle rate. E. all projects with a positive NPV or a PI greater than the one. F. all projects with a positive NPV G. all projects with an IRR greater than the hurdle rate or a Pl greater than one.
- How do you apply the Net Present Value rule when multiple projects are available and you have the added constraint of accepting only one project?Please see image for question to solve for. Question C options are; This would make Project B more appealing.This would make Project B less appealing.Please see image for question to solve for. Options for question B are; YesNo