Hide answers a a projects npv is generally found by

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<< HIDE ANSWERS A A project’s NPV is generally found by compounding the cash inflows at the WACC to find the terminal value (TV), then discounting the TV at the IRR to find its PV. The higher the WACC used to calculate the NPV, the lower the calculated NPV will be. If a project’s NPV is greater than zero, then its IRR must be less than the WACC. If a project’s NPV is greater than zero, then its IRR must be less than zero. The NPVs of relatively risky projects should be found using relatively low WACCs. B C D E
QUESTION: 13 [QUESTION BANK ID: 7358] CORRECT In 1985, a given Japanese imported automobile sold for 1,476,000 yen, or $8,200. If the car still sold for the same amount of yen today but the current exchange rate is 144 yen per dollar, what would the car be selling for today in U.S. dollars? TYPE: MULTIPLE CHOICE
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QUESTION: 14 [QUESTION BANK ID: 109554] CORRECT Bing Services is now in the final year of a project. The equipment originally cost $20,000, of which 75% has been depreciated. Bing can sell the used equipment today for $6,000, and its tax rate is 40%. What is the equipment’s net after-tax salvage value for use in a capital budgeting analysis? Note that if the equipment's final market value is less than its book value, Bing will receive a tax credit as a result of the sale. TYPE: MULTIPLE CHOICE << HIDE ANSWERS B C D E
QUESTION: 15 [QUESTION BANK ID: 33165] TYPE: MULTIPLE CHOICE CORRECT
Taussig Technologies is considering two potential projects, X and Y. In assessing the projects’ risks, the company estimated the beta of each project versus both the company’s other assets and the stock market, and it also conducted thorough scenario and simulation analyses. This research produced the following numbers: Whic h of the following statements is CORRECT? << HIDE ANSWERS B C D E
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