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Which of the following statements is CORRECT? Assume that the project being considered has normal cash flows, with one outflow followed by a series of inflows.
a. The lower the WACC used to calculate it, the lower the calculated NPV will be.
b. A project's NPV is found by compounding the cash inflows at the IRR to find the terminal value (TV), then discounting the TV at the WACC.
c. If a project's NPV is less than zero, then its IRR must be less than the WACC.
d. If a project's NPV is greater than zero, then its IRR must be less than zero.
e. The NPV of a relatively low-risk project should be found using a relatively high WACC.
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What is the total cost of Job 6.15 if Business Solutions applies overhead at 50% of direct labor cost and what is the total cost of job 6.15 is Business Solutions uses activity based costing?
Suppose the price of a stock is $100 a share. A call option on the stock with two months until expiration date and exercise price $105 sells for $2. A put on the stock with the same strike price and expiration date sells for $7. What is the market pr..
Which of the following indicates that a project is expected to create value for its owners?
Assume the following information for a car note: Original loan amount = $23,500 Annual interest rate = 7.25% Term of loan = 24 months. What is the principal balance on the loan after six months?
An inverted yield curve would suggest that
Based on this information calculate the IRR for the project ___What's the present value of the $1,100 due in 20 years (FV=$1,000)? We assume current interest rate is 8%, compounded annually.
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