The IRR of normal Project X is greater than the IRR of normal Project Y, and both IRRS are greater than zero. Also, the NPV of X is greater than the NPV of Y at the cost of capital. If the two projects are mutually exclusive, Project X should definitely be selected, and the investment made, provided we have confidence in the data. Put another way, it is impossible to draw NPV profiles that would suggest not accepting Project X. Group of answer choices True False

Which of the following statements is CORRECT?   a. If a project with normal cash flows has an IRR greater than the cost of capital, the project must also have a positive NPV.     b. If a project with normal cash flows has an IRR less than the cost of capital, the project must have a positive NPV.     c. If the NPV is negative, the IRR must also be negative.     d. A project's MIRR can never exceed its IRR.     e. If Project A's IRR exceeds Project B's, then A must have the higher NPV.

The relationship between NPV and IRR is such thata. both approaches always provide the same ranking of alternative investment projects.b. the IRR of a project is equal to the firm's cost of capital if the NPV of a project is $0.c. if the NPV of a project is negative, the IRR must be greater than the cost of capital.d. none of the above

If a particular project has multiples rates of return (i.e., multiple values of IRR), it means that the project is economically more attractive as compared with a project with a single IRR. Group of answer choices True False

Which of the following statements is CORRECT?   a.  An NPV profile graph shows how a project's payback varies as the cost of capital changes.   b.  The NPV profile graph for a normal project will generally have a positive (upward) slope as the life of the project increases.   c.  An NPV profile graph is designed to give decision makers an idea about how a project's risk varies with its life.   d.  An NPV profile graph is designed to give decision makers an idea about how a project's contribution to the firm's value varies with the cost of capital.   e.  We cannot draw a project's NPV profile unless we know the appropriate WACC for use in evaluating the project's NPV. Provide explanation for the choice

You should accept a project when the ?: net present value is negative. profitability index is positive. payback period exceeds the required period. AAR is greater than the required return.                               7.     Which one of the following statements is correct? The payback period is also referred to as the benefit-cost ratio. The internal rate of return can be reliably used for all independent projects. The profitability index is used when the investment funds are limited. The net present value should not be used to rank mutually exclusive projects.   8.     You should accept a project when the ?: net present value is negative. profitability index is less than 1 but greater than 0. discounted payback period is less than the required period. AAR is less than the required return.   9.     The crossover point ? : is used to determine which one of two internal rates of return for a project should be used when determining if a project should be accepted. 2. is the…

Which of the following statements is correct?       A. If the NPV of a project is greater than 0, its PI will equal 0.       B. If the IRR of a project is 0%, its NPV, using a discount rate, k, greater than 0, will be 0.       C. If the PI of a project is less than 1, its NPV should be less than 0.       D. None

Which project below would you consider acceptable? One whose IRR is greater than the MARR One whose MARR is greater than the IRR O One whose RIC is less than the MARR One whose MARR is greater than the MIRR

Which of the following statements is (are) true about project appraisal methods: (i) NPV is the best measure for project appraisal even when capital is rationed. (ii) IRR measures percentage returns of an investment rather than added value. (iii) Contrary to real options, NPV assumes a now or never decision to invest.

Which of the following statements is most FALSE? A. If a project with normal cash flows has a positive NPV, it will definitely have an MIRR greater than the cost of capital. B. If a project with normal cash flows has an IRR that is greater than the cost of capital, then taking on that project would decrease the value of the firm. C. If a project has normal cash flows, then the MIRR has to be between k and IRR if the project has positive interim cash flows (cash flows between t=0 and the end of the project). D. If a project with normal cash flows does not have any interim cash flows, the project's IRR will equal the project's MIRR. E. Multiple IRRS can exist for a project if the project has nonnormal cash flows. OA OB OC