In general, the greater the difference between the magnitude and/or timing of cash inflows, the greater the likelihood of conflicting ranking between NPV and IRR
Indicate whether the statement is true or false
TRUE
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Excess capacity leads to companies initiating an increase in price
Indicate whether the statement is true or false
Interest earned on the cash balance in the bank is recorded by the bank as:
A. An increase in the depositor's bank account. B. A decrease in the depositor's bank account. C. A decrease in the bank's asset account. D. An increase in the bank's expense account. E. An increase in the bank's asset account.
The fact that you must pour foundation before you frame the house and that you have to frame the house before you can put on the roof demonstrates scheduling constraints.
Answer the following statement true (T) or false (F)
Interstate Appliance Inc is considering the following 3 mutually exclusive projects
Projected cash flows for these ventures are as follows: Plan A Plan B Plan C Initial Initial Initial Outlay = $3,600,000 Outlay = $6,000,000 Outlay = $3,500,000 Cash Flow: Cash Flow: Cash Flow: Yr 1 = $-0- Yr 1 = $4,000,000 Yr 1 = $2,000,000 Yr 2= -0- Yr 2 = 3,000,000 Yr 2 = -0- Yr 3 = -0- Yr 3 = 2,000,000 Yr 3 = 2,000,000 Yr 4 = -0- Yr 4 = -0- Yr 4 = 2,000,000 Yr 5 = $7,000,000 Yr 5 = -0- Yr 5 = 2,000,000 If Interstate Appliance has a 12% cost of capital, what decision should be made regarding the projects above? A) accept plan A B) accept plan B C) accept plan C D) accept Plans A, B and C