
FINANCIAL ACCOUNTING
10th Edition
ISBN: 9781259964947
Author: Libby
Publisher: MCG
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If the
Group of answer choices
- equal to the required rate or return
- greater than the required rate of return
- equal to the accounting rate of return
- greater than the accounting rate of return
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- When does the project reach the payback point?arrow_forwardInvestment projects can be evaluated using static or dynamic methods. Dynamic valuation methods include Net Present Value (NPV), Internal Rate of Return (IRR), and Payback Time. If we must choose one of the 3 investment evaluation methods. What is the best method or the one that provides us with the most information for making decisions and why?arrow_forward1. State the criterion for accepting or rejecting independent projects under each of the following methods. - Profitability index - Discounted payback period - Accounting rate of return - Net present value - Payback period - Internal rate of returnarrow_forward
- The internal rate of return is the: discount rate that makes present value of cash inflows equal to present value of cash outflows. discount rate that causes a project's after-tax income to equal zero. discount rate that results in a zero net accounting return. rate of return required by the project's investors.arrow_forwardThe internal rate of return (IRR) is the: Multiple Choice discount rate that results in a zero net present value for the project. discount rate that causes a project's aftertax income to equal zero.arrow_forwardThe payback period is a non - discounted cash flow technique that measures: a. The time required to recover the initial investment b. The profitability of the project c. The net present value of the project d. The internal rate of return of the projectarrow_forward
- In calculating the Net Present Value, the project would be acceptable if the outcome was: Group of answer choices Positive Positive or Zero Zero Negativearrow_forwardThe method that measures a projects return based on present values is the: Internal Rate of Return Discounted Payback Period Modified Internal Rate of Return None of the Abovearrow_forwardThe use of natural resources in an economic activity involves setting up a project forharvesting (i.e. extracting) these resources. For the project to be viable, both economic andfinancial indicators - such as net present value (NPV) and internal rate of return (IRR)considering time value of money - are employed. a) Briefly explain the concept of "time value of money". b) Moreover, explain how you will use NPV and IRR to determine the viability of a project.arrow_forward
- For a capital investment project to be acceptable, it must generate a rate of return A) Less than the required rate of returnB) Equal to or greater than the cost of capitalC) equal to the initial investmentD) none of the abovearrow_forwardDefine each of the following terms:b. Incremental cash flow; sunk cost; opportunity cost; externality; cannibalization; expansion project; replacement projectarrow_forwardPLEASE ANSWER ASAP.....arrow_forward
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