c. If the WACC rose to 12% would this affect your recommendation? I. Since all of the cash flows are negative, the NPV's will be negative and we do not accept any project that has a negative NPV. II. When the WACC increases to 12%, the NPV of costs are now lower for LCC than HCC. III. When the WACC increases to 12%, the NPV of costs are now lower for HCC than LCC. IV. When the WACC increases to 12%, the IRR for LCC is greater than the IRR for HCC, LCC would be chosen. V. When the WACC increases to 12%, the IRR for HCC is greater than the IRR for LCC, HCC would be chosen. -Select- : Why do you think this result occurred? I. The reason is that when you discount at a higher rate you are making negative CFs higher and this lowers the NPV. II. The reason is that when you discount at a higher rate you are making negative CFs smaller and this lowers the NPV. III. The reason is that when you discount at a higher rate you are making negative CFs smaller thus improving the NPV. IV. The reason is that when you discount at a higher rate you are making negative CFs higher thus improving the IRR. V. The reason s that when you discount at a higher rate you are making negative CFs higher thus improving the NPV. -Select-:

In a few sentences, answer the following question as completely as you can. According to your textbook, “an investment should be accepted if the net present value is positive and rejected if it is negative” (p. 239). What does an NPV of zero mean?If you were a financial decision maker facing a project with NPV of zero (or close to zero) what would you do? Can you think of any other factors that might influence your decision?

Consider the following figure. If firm A were to use the average or composite WACC it would Rate of Return 13.0 (5) 11.0 10.0 90 Project L 70 70 Division L's WACC О Riskov Division H's WACC WACC Project H Composite WACC Firm A Risk Riskov O accept Project L and reject Project H O be making the right decisions on acceptance or rejection of both projects O accept both Project L and Project H O reject both Project L and Project H O accept Project H and reject Project L

solve this parctie problem

I also have some confuse for the decision: system B is more beneficial then system A due to lower negative NPV from system A.  Should we need compare with negative NPV or cost per year? For negative NPV, system A ($541,843)is lower negative NPV than system B($706,984.82). On the other hand, system B ($167,116.14) is lower cost of each year than system A ($174,652.85). Thank you ~

How do I determine which is the correct answer for this problem? A company estimates that an average-risk project has a WACC of 10 percent, a below-average-risk project has a WACC of 8 percent, and an above-average-risk project has a WACC of 12 percent. Which of the following independent projects should the company accept? a. Project A has average risk and an IRR = 9 percent. b. Project B has below-average risk and an IRR = 8.5 percent. c. Project C has above-average risk and an IRR = 11 percent. d. All of the projects above should be accepted. e. None of the projects above should be accepted. Please answer fast I give you upvote.

I think question 3 is not answered clearly.  If Project A is rejected due to negative NPV, then all positive NPVs projects should be accepted.  The answer is not clear. Please correct me if I am missing something.    Question 3) If the firm uses the discounted-payback rule, will it accept any negative NPV projects? Will it turn down any positive NPV projects? How do you know?    Your answer is:  No Due to Project A's negative NPV, it cannot cover the initial investment within its useful life. Will it turn down any positive NPV projects? It will reject projects with positive NPVs but not those with negative NPVs. If all potential cash flows are taken into account but the project still doesn't reach the designated cutoff point, the NPV can still be positive.

36 The relationship between the payback method and the internal rate of return is that:  Group of answer choices  The discounted payback period is exactly the same as the IRR.  The payback period is the present value factor for the IRR.  A payback period of less than one-half of the life of a project will yield an IRR lower than the target rate.  A project whose payback period does not meet the company’s cut-off rate for payback will not meet the company’s criterion for IRR.

Which of the following statements are true? I At higher discount rate, a project is more likely to be rejected. II A project is acceptable if the IRR = 8% while the cost of capital = 5%. III IRR does not account for time value of money. Group of answer choices 1. All of the above. 2. I and II 3. I and III 4. II and III

Note:- Do not provide handwritten solution. Maintain accuracy and quality in your answer. Take care of plagiarism. Answer completely. You will get up vote for sure.