Which of the following is a pitfall of the payback rule

Assignment Help Finance Basics
Reference no: EM13296843

Which of the following is a pitfall of the payback rule?

a. It gives equal weight to cash flows before cutoff
b.it ignores cash flows after cutoff
c.it biases the firm against long term projects that might be very profitable
d.all the above are pitfalls

 

Reference no: EM13296843

Questions Cloud

Estimate low-dose cancer risk from occupational inhalation : the recommended threshhold limit value ( TLV-ACGIH) air concentration for occupational exposure to water-insoluble hexavalent chromium Cr (VI) is 0.01 mg/M^3. this concentration is based on an assumption that the individual is generally healthy an..
Explain calculate the ph during the titration : Calculate the pH during the titration of 10.00 mL of 0.400 M hypochlorous acid with 0.500 M NaOH. First what is the initial pH (before any NaOH is added). The Ka for HOCl is 3.0 x 10-8 M.
Explain what happens when the base solution : What happens when the base solution was added to the acid solution but was not stirred while temperature measurements were made
Calculate the induced current in the copper wire loop : A single loop of copper wire moves at an unknown constant speed v into a region of uniform magnetic field B = 5.00 T. Calculate the induced current in the copper wire loop
Which of the following is a pitfall of the payback rule : Which of the following is a pitfall of the payback rule?
How many of the zeroes would you need to issue : In 23 years, what will your company's repayment be if you issue the coupon bonds?
Find the kinetic energies of rod : Two thin rods of length L are rotating with the same angular speed ? (in rad/s) about axes that pass perpendicularly through one end. Find the kinetic energies of rod A with its attached particle and of rod B
Define the equation for the combustion of gaseous : The equation for the combustion of gaseous methanol is: 2CH3OH(g) + 3O2(g) ? 2CO2(g) + 4H2O(g) Estimate the ?H°rxn per mole of methanol combusted
Are the benefits of further education worth the associated : Jenny feels that her opportunity cost of capital is 6%. Given her estimates, find the net present value (NPV) of entering this MBA program. Are the benefits of further education worth the associated costs?

Reviews

Write a Review

Finance Basics Questions & Answers

  What will a, e, and d be after the change to the capital

Suppose that Ms. Macbeth's investment bankers have informed her that since the new issue of debt is risky, debt holders will demand a return of 12.5%

  Calculate new equilibrium price of the stock

A common stock currently has a beta of 1.3, the risk factor is an annual 6%, and the market return is an yearly rate of 12%.

  Compute the cost of equity capital using capm

Compute the cost of equity capital using CAPM and dividend capitalization model and Calculate the after-tax cost of preferred stock for Bozeman-Western Airlines

  Bond values and yields

Explain or define and discuss a bond issued by city that is having a little bit of problem with creditworthiness (but not "junk" level yet) and how it is differentiated from other bonds.

  How much net income must it earn to meet its capital

If the company follows the residual dividend model, how much net income must it earn to meet its capital budgeting requirements and pay the dividend, all while keeping its capital structure in balance?

  What effective annual rate does the bank pay

Charter Bank pays a 3.30% nominal rate on deposits, with monthly compounding. What effective annual rate (EFF%) does the bank pay?

  At what rate is the dividend growing

Shares of the katydid Co. common stock are currently selling for $ 27.73. The last dividend paid was $1.60 per share. The market rate of return is 10 percent. At what rate is the dividend growing?

  What is the value of a share of preferred stock

What is the value of a share of preferred stock that pays a $4.50 dividend, assume k is 10%.

  Difference between defined benefit and contribution

Determine the difference between defined benefit and defined contribution and also define derivatives.

  Calculate the price of a zero coupon bond

Calculate the price of a zero coupon bond that matures in 20 years if the market interest rate is 6.5 percent. Assume semi-annual compounding.

  Determine additional cash and value of shares

Raviv Corporation has $100 million in cash that it can use for a share repurchase. Assume instead Raviv invests the funds in an account paying 10% interest for one year.

  How many shares need to be sold

If the offer price is $45 per share and the company's underwriters charge a 7.5 percent spread, how many shares need to be sold?

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd