Which project should you invest in according to the NPV and IRR? Project A NPV@ 10% WACC = $135 and IRR 22% %3D Project B NPV @ 10% WACC = $17 and IRR 21% Project C NPV@ 10% WACC = $146 and IRR 23% %3D O a. Project A
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- Consider the following two projects: Project Year 0 Year 1 Year 2 Year 3 Year 4 Discount Cash Flow Cash Flow Cash Flow Cash Flow Cash Flow Rate A - 100 40 50 60 N/A 0.18 B - 73 30 30 30 30 0.18 Assume that projects A and B are mutually exclusive. The correct investment decision and the best rationale for that decision is to A. invest in project B, since NPV, > NPV, A B. invest in project A, since NPV, > 0. OC. invest in project A, since NPV, IRR, A'A firm is considering the following independent projects. Project Investment Present value offuture cash flows NPV A $130 $176 $46 B $103 $115 $12 C $183 $287 $104 D $161 $199 $38 E $184 $273 $89 What is the Profitability Index of Project B? Question 5Answer a. 0.85 b. 1.12 c. 0.89 d. 1.18Use the information for the question(s) below. Project A - 10,000 Project B Time 0 - 10,000 Time 1 5,000 4,000 Time 2 4,000 3,000 Time 3 3,000 10,000 If WiseGuy Inc. uses IRR rule to choose projects, which of the projects (Project A or Project B) will rank highest? OA. Project A OB. Project B OC. Project A and Project B have the same ranking OD. Cannot calculate a payback period without a discount rate.
- of stion Given the following information about projects A and B: Project A Project B -10,000 -10,000 4,000 3,000 10,000 Time 0 Time 1 Time 2 Time 3 If alpha company uses IRR rule to choose projects, which of the projects (Project A or Project B) will rank highest? Select one: O O O 5,000 4,000 3,000 a. Project A b. Project B c. Project A and Project B have the same ranking. d. Cannot calculate a payback period without a discount rate.Consider the following two mutually exclusive projects: When (at what levels of the cost of capital) would choose project A? Cash Flows ($) Project C0 C1 C2 C3 A -90 +60 +50 0 B -100 0 0 +140 Multiple Choice When the cost of capital is less than 9.58% and mroe than 11.87% When the cost of capital is more than 9.58% and less than 14.98% When the cost of capital is less than 9.58% and more than 14.98% When the cost of capital is more than 0% and less than 9.58%Which of the following statement is true? * IRR and discount rate all have the same meaning.... If BCR is less than zero, an investment to a conservation project is worthwhile.... Both of them are true
- Use attachment to answer question q1- This question relates to the diagram, which shows the NPV profile for Projects X and Y. Assume Projects X and Y and mutually exclusive, discretionary projects. For what range of costs of capital should Project X be accepted? Select one: a. Greater than 9% b. Between 4% and 13% c. Greater than 13% d. Greater than 4%Bausch Company is presented with the following two mutually exclusive projects. The required return for both projects is 13 percent. Year 01234+ Project M -$144,000 63,100 81,100 72,100 58,100 Project N -$351,000 154,500 176,000 139,500 106,000Refer to the table below to answer the following question. Project Initial Investment NPV P 200 22 Q 180 26 R 185 38 S 380 10 The project with highest Profitability Index is Project P Project Q Project R Project S
- PRINTED NAME _____________________________________________ Project X Project Y PB (payback) DPB (Discounted Payback) NPV $ PI IRR% MIRR% EAA (NUS) $ CROSSOVER RATE % NPV $ (using crossover rate) If the projects are INDEPENDENT, which would you choose? WHY? _____________________________________________________________ If the projects are MUTUALLY EXCLUSIVE, which would you choose? WHY? _____________________________________________________________ When you would be INDIFFERENT between the projects? WHY? _____________________________________________________________ SIGNATURE _____________________________________________________Evaluation of Projects or ME Alternatives based on different Economic Worth Analysis: AW analysis of one project Choose... ROR analysis of two alternatives Choose... PW analysis of one project Choose... • ROR analysis of one project Choose... 0 PW analysis of ME Alternatives Choose... The remaining undepreciated capital investment in year t is called: Select one: O a BVt O b. P OC B O d. MV Although land is considered as real property, it is not depreciable. Select one: O True O False4. Consider the two projects depicted in Table 2: The net present value (NPV) of project A is ________ TABLE 2 Project Year 0 Year 1 Year 2 Year 3 Year 4 Discount Cash Flow Cash Flow Cash Flow Cash Flow. Cash Flow. Rate A. -100. 40. 70 60 0. 0.11 B -80 50 30 30 30 0.11 5 Consider the two projects depicted in Table 2: The net present value (NPV) of project B is ________.